Gain competitive advantage from this recession
Marc is a consultant at Shirlaws, a business coaching firm that helps companies grow. Their founder has a strong background in financial markets and they have analysed markets over time, looking in depth at different types of recession – L, V and W shaped.They believe that the current recession is W shaped, characterised by a decline, a bounce, levelling out into a drag, then another dip, followed by a period of growth. Shirlaws believe that the UK economy is currently in the drag period.
During the initial decline and first bounce before the drag, businesses should look at their systems, processes and people to see where they can make savings and create efficiencies.
During the drag phase, i.e. NOW, businesses should be developing their strategy for growth during the upcoming growth period. Now is the time to be looking for investment, getting the growth strategy ready and starting to implement it.
Many businesses leave growth and investment until the recovery is already underway. However, with many strategies taking several months, sometimes even two years, to show a return, this means that a large chunk of the growth and recovery period has been missed.
Shirlaws have found that the second dip is a time when many companies fail, either because they have been unable to last the course or decide to sell/exit. This is a shame for those companies, as recovery and growth is just around the corner. However, for those companies that have streamlined, have put investment in place, have worked their growth strategy through, this is a time of great opportunity, with the chance to buy competitors or take up the market share of those exiting the market.
A key part of the investment and growth strategy should be sales and marketing. It is well known that companies that retain brand awareness and promotional activity during a recession are best placed to benefit from the recovery. Some statistics published by Business Week show that companies that did not cut their marketing spend during the 1974-5 and 1981-2 recessions had higher sales growth than those that did both during and after the recession.
So, the moral of the story? Don’t leave your recovery/growth strategy too late. Start today!