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Five steps to recession-proof your business

Five steps to recession-proof your business

Follow Chris Stuckey’s key steps to create a rock-solid business model and weather future hits

Keeping a business up and running is always a challenging task. But when you are in the middle of the third wave of a pandemic that has caused worldwide supply chain issues and even provoked the Great Resignation, it can be even more daunting – and that’s without even mentioning Brexit. Yet, as we know, crises are also great moments to learn and seize opportunities.

With this in mind, here are five essential pieces of advice that every current and future franchisee should consider when it comes to running a successful business during times of severe disruption. Following these key steps will help pave the way to building a recession-proof business model.

1. Lead by example

If you’re already running a franchise or considering becoming a franchisee, you will know that signing up to a company means signing up to its core values. Linking a strong set of values with strong leadership should be foremost in a challenging climate, and you must live up to these values, always taking into consideration key areas such as expertise, fairness, honesty, and support.

Apply this set of values not only just to your customers, but also to your employees, suppliers, and all stakeholders. To bring out the best in your team, you must be seen to follow the rules, engage with your own values and treat your employees with respect. This will allow your employees to grow and develop with support from your organisation.

2. Build a diverse portfolio of customers

The pandemic has been a great time to evaluate the performance of businesses. One standout lesson has been if you want to build a recession-proof business model, you need to develop a diverse portfolio of customers. Diversification of your clients reduces dependence on any particular market area. Therefore, you avoid the repercussions of any dips in a specific industry.

In a nutshell, look to provide a service or products that your clients consider essential, thus minimising the impact when industries begin to shut down due to financial strain. Sectors that are less cyclic - such as infrastructure, construction, farming, military, manufacturing and so on - provide continued activity during times of crisis. This ensures that even in the most challenging times (such as the COVID-19 pandemic), you don’t suffer the same losses as other nonessential businesses.

3. Plan a (flexible) roadmap to success

Planning is another crucial ingredient because it creates a unified framework for the whole business. However, think about planning as a flexible roadmap that will help prevent critical issues from occurring and allow you to monitor the performance of your business.

Arguably, no one could have planned for a global pandemic, but we can certainly say that those who spent a significant amount of time and resources preparing for the impact of Brexit were able to ensure the continuity of supply necessary to maintain the support of their clients. Being able to satisfy your customers’ needs at all times should always be your imperative.

4. Take advantage of your supporting network

Another critical step is taking advantage of your franchisor’s support network. I’d even suggest doing this on a day-to-day basis. And if you are an entrepreneur looking for investment, chase those franchises with an ‘all for one’ culture. These businesses create powerful bonds between franchisee and franchisor, adding a real sense of family within the whole organisation.

Bear in mind that a supportive franchisor will not only provide you with access to strategy development, customer engagement, portfolio management and innovation, but also will guarantee you a customer base from day one. Not starting a business from scratch will give you a significant advantage.

Make the most of your franchisor’s training programmes and thoroughly educate your employees on all aspects of your business – needless to say, a boost in digital tools is a must. In times of the Great Resignation, training is a good way to demonstrate to your staff that you care about them.

5. Humanise your brand

And finally, never forget that it’s always a people business. No matter what your company’s aims, the ultimate target is to engage with your customers and provide a tailored service, and that connection should be based on a human level.

Beyond B2C or B2B frameworks, marketers are increasingly talking about human-to-human (H2H) relationships, and in times of COVID-19, it’s pivotal to humanise your brand. No one will engage with a company that’s unrelatable and faceless.

So, don’t forget the local perspective and get involved in your community. As mentioned before, be supportive, but also fair and honest with your customers and employees. Put yourself in their shoes and remember that in times of significant disruption, empathy and understanding can go a long way to helping businesses overcome challenges and remain connected with customers.

Even when franchises operate in different contexts and markets, following these five important steps will, without a doubt, help you as a franchisee or entrepreneur to keep your business running smoothly in turbulent times. These principles are the summary of my experience working at Pirtek, the UK and Europe’s number one provider in fluid transfer solutions and on-site repairs. As a franchise with over 30 years of experience, we know that solid values and a refined business model, together with a strong supporting network, is the foundation for success.

The author

Chris Stuckey is managing director at Pirtek UK & Ireland.

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