If you haven’t lived under a rock, you have felt the effects of the pandemic. Its reach is inescapable research The COVID-19 pandemic is having an alarming impact on the collective mental health of the world’s population, regardless of who they are. For business owners across the country, it’s safe to say that most have felt this pervasive pressure, especially on their finances.
I certainly felt the heat in my own printing business, PostcardMania, where weekly earnings were down 41% at one point. It was very scary at first, I’m not going to lie to you – but this wasn’t my first rodeo. I got my business through the 2008 real estate crash, learned from it, and this time was able to come up with a recession-proof plan.
As a result of executing this plan, I managed to weather the initial closings without firing anyone, hit the best third quarter in the company’s history (26% more than the second quarter!), Set multiple sales records, and added 36 additional employees.
The following is a combination of business pivots and legacy corporate institutions that took me through thick and thin that you can apply to your business.
1. Make smart cash flow decisions
Nobody knows your company as well as you do. As such, these steps only work if you take the time to analyze every tiny aspect and dusty nook and cranny to determine what can be tweaked or removed for your benefit.
But this is important: DO NOT cut your marketing off. More on that shortly.
For printers with deep B2B networks, one area where you can relieve financial pressures is to leverage your professional relationships for instant support. As long as you don’t have skeletons in your closet, some people will be happy to help and give you some pace. To us it looked like we were asking our suppliers some leeway and allowing ourselves to accumulate debts with them to pay them off in the near future. They were happy to sign as we have a long relationship and always pay our bills on time!
Taking on strategic debt is another reliable way to give your business an opportunity to absorb losses and get back into the black. We took advantage of what was completely forgivable to recover Paycheck Protection Program Government loans rolled out to help keep small businesses afloat. The application window for this loan has now closed, but the Small Business Association is offering one Lenders Match Program to find loans and lenders that fit your situation.
The last option before things get ugly (lay off staff, shut down) is to liquidate assets. When I say “asset” it can be literally anything – buildings, equipment, inventory, vehicles, even the chair you sit in – that you can sell for cash. Use common sense as you assess the importance of each article to your business. While we had already planned to sell a partially used warehouse that we owned, if that sale ended up taking place amid the pandemic, if I said it doesn’t give me any extra security, I would be lying.
Aside from revising your company’s internal structure, there are a few things you can implement that will help increase the flow of money.
2. Build loyalty / credibility and show your commitment to customers by maintaining a constant flow of communication with them
In difficult times, brand loyalty can go a long way. Brand loyalty comes from persistence, which means everything in this incredibly uncertain year. Silence can be your worst enemy in times like these. According to international research, “… consumer behavior changes rapidly in terms of the importance they attach to branded products … This is not brands ‘fault, but it is brands’ responsibility to respond quickly to these changes. Otherwise, their long-term survival could be jeopardized. “
What does that mean? This means that your best chance of survival is to let your customers know that you are reliable by communicating with them regularly. If you maintain a drain line with them, especially during times like this, you will surely deserve their loyalty.
When money is tight there are affordable methods of communication. Writing blog posts or articles, updating your website, sending out emails and e-newsletters, and staying on social media are inexpensive ways to keep in touch and reassure customers that you are there for them .
If you have the resources, send something in print, our favorite medium. A Study conducted for the US Postal Service found that physical displays kept viewers busy longer and caused more brain activity associated with value and desire than digital ones. I am sure that, as a printing company, you know the value of concrete communication. It can be worthwhile to prioritize.
While engagement with previous customers is important and will certainly help, marketing can be even more important to potential customers in unlocking new revenue streams.
3. “Never stop Marketing” has been a PCM mantra since I almost lost my business
I know it might seem counterintuitive to spend more money when you run out of money, but listen to me. When these situations arise, most people tend to panic and pull back on their marketing to make up for losses, right? The thing is, this is actually the counter-intuitive thing to do. Why pull something for extra money when that something will bring you income?
Like I said The more communication and marketing outflows you have, the more money you will receive over many years. This isn’t just a catchy jingle that I use to promote my business – it’s a slogan that saved it.
Around 2008, when real estate marketing collapsed, I lost just under half (46%) of my clients who were mortgage brokers. In short, I cut my marketing down when a financial advisor told me to, and it almost put my company out of business. The next year we were down 15%, or $ 4.5 million, year over year. It was a great loss. After resuming my marketing expenses, there was an influx of leads and cash that eventually stabilized the business again.
I learned from that initial mistake, and when this year’s recession hit I stuck to my guns and kept my marketing pumping. As a result … voilà! After a short (but stressful) five weeks when the pandemic first hit, my weekly income returned to pre-crash levels. And then some. We are now on track to increase at least 10% this year.
We’re not the only ones who believe that either. So you don’t just have to take my word for it.
The Harvard Business ReviewExamining how companies reacted to the last economic recession in 2008 and the potential impact of those decisions found that “Companies that rashly cut their marketing spend (during an economic downturn) often find that they spend far more later need to recover from their prolonged absence from the media landscape when they have saved in the right order. ”
Former Microsoft executive and current CEO of MDC Partners, Mark Penn, rolled into one Interview detailed As a company’s marketing is the number one indicator of why it is struggling or thriving in the pandemic.
In another interviewHe discusses the critical role marketing will play in the recovery of the economy.
Combined into one recovery plan, these three actions will work for your print shop – just make sure you are making the best decisions for your business!