Thriving and surviving: Five tips for businesses weathering the economic downturn

All I’ve seen is doom and gloom in the media lately about the economic downturn leading to a recession. In some ways, the concerns are justified. The next 12 months will be a challenging time for businesses, both large and small. We’re in a state of extreme global economic uncertainty, and rightfully many entrepreneurs and business owners are fearful of what’s to come and wondering how to navigate the challenges they’re now facing. 

But — and here’s the good news — small business owners and leaders have the distinct advantage of being more agile than larger companies, which makes it easier to pivot when challenges arise (and they always do). There will always be new challenges we need to overcome, not just in times of crisis but in everyday life – the market changes, new competitors arrive, key team members leave, a recession hits or a virus prompts an economic retraction like COVID-19. Navigating uncertainty is a core capability every business owner is forced to foster.

In my own journey as an entrepreneur and investor I’ve experienced my fair share of setbacks. I spent the first four years of my business career making zero visible progress. My very first business, a call centre I launched when I was 18 with a $20,000 loan, failed within only a few short months. It was an incredibly discouraging introduction to business, but it was the failures of my first few years that ultimately gave me the lessons I needed to co-found MBE Education, a business which enabled small and medium-sized enterprises to raise money from investors and acquire and exit businesses. It quickly became one of Australia’s fastest-growing companies and gave me the solid financial foundation to start The Entourage.

Of course, the journey up until today though hasn’t been without challenges. But one of the most important lessons I’ve learnt in business is that it’s not the size of the challenge that matters — it’s the size of your resilience. So never waste a crisis, always use it to get better. 

There’s a quote on leadership I love from Barack Obama: “Leaders look when others would prefer to look away, leaders stay upright when others would prefer to fall.” As entrepreneurs and business leaders, it is essential that we choose to show up every day and lead through challenging times, choose not to be defeated no matter what is thrown our way, and choose unwavering conviction that we will come out of these times better than ever. 

For leaders looking to make the most out of our current economic downturn, and see their business successfully navigate the rough seas ahead, below are my top five pieces of advice: 

How to make the most of the economic downturn

1. Adopt a focus on revenue-generating activities

   When the market is turbulent, entrepreneurs should be focusing 80% of their time and efforts on revenue generating activities. But this is where so many go wrong. From my experience, the average business owner only spends as little as 10% of their time on this.

2. Have a plan, but be flexible

   This is the mindset that every business owner and their team needs to get comfortable with. Develop your north stars so that you and your team know where you’re going, and everyone knows the role they have to play in getting there, but be clear with them — plans will change as goal posts do, and that’s ok, because small-to-medium sized businesses have the advantage of pivoting and changing direction quickly (this is something that large organisations do not have).

3. Develop an empathy map for where your customers are

   When the economy changes, so do the lives of your customers. It’s crucial for business owners to develop an understanding of what is going on for their customers, their core challenges, and any changed needs they may have. Business owners should then update all their marketing and communications around those insights, so they can speak directly to the hearts and minds of their customers in these uncertain and challenging times.

4. Seek out the right mentors and advisors

   Being an entrepreneur can be lonely, and no one person can know it all, so surrounding yourself with experts and industry leaders will help you feel more supported, which is invaluable. This method of connecting members with experts for personalised coaching to share strategies for success is how The Entourage has helped our members consistently outperform the market. From personal experience I know that when you and your company are struggling, finding the right people to help is the last thing you want to do, but that’s truly when you need to invest in this the most — otherwise you risk losing everything you’ve worked so hard to achieve. 

5. Make time to disconnect

   For many business owners, self-care is still considered the occasional holiday before returning to the office working at full speed, but this leads to sub-par functionality. Instead, think of methods that can be implemented daily — whether it be exercising, meditating, journaling, spending time with the kids — and make this practice part of your routine. Technology today means we are forever connected to the constant demands of our work, so it’s important to habitualise from disconnecting with technology and reconnecting with your own needs.

With all the disruptions over the past couple years, entrepreneurs and business owners have been dealt a very difficult hand, but as the adrenaline wears off and the resilience fatigue kicks in, it’s more important now than ever to re-focus, re-energise, and re-align with yourself and your company.

There is a light at the end of the tunnel, and by using the right framework and strategies, you won’t just succeed, but achieve in months what takes your competitors years to accomplish.