People spend less during recessions when the economy is weaker and their disposable income is lower. Therefore, companies need to come up with innovative techniques to increase sales in times of recession if they want to stay competitive. The economy can change direction at any time and always being prepared is key. If you don’t have a plan, a recession can impact your business sales.
The idea that businesses will experience a drop in sales during a recession is widely held. The market is really still as competitive as it was before. Depending on the product or service, during a recession sales may also increase. However, if you fail to keep up with the competition, you risk closing your doors to competing businesses.
Businesses are both recession and depression resistant, depending on how an entrepreneur views them. Therefore, it is time for Sri Lankan retailers to follow the recession proof theory and choose what to supply and how to present it to a majority of literally depressed and cash strapped customers. Regardless of a country’s socio-economic situation, the general global trend shows that consumers immediately prefer cheaper goods and services when going through a national financial catastrophe.
Without a doubt, Sri Lanka is in crisis. Effective crisis management will determine whether traders succeed or fail, regardless of the size of their business. They have a decent chance if they put enough effort into the future and see the crisis as an opportunity.
They have a decent possibility of recovery and even development if they put enough effort into the future and see the crisis as an opportunity. With limited foot traffic, slow sales and limited cash flow, this will not be an easy task. However, retailers should make an effort to capitalize on the idea that customers still prefer to shop independently, as it gives them a sense of control, especially when purchasing consumables.
The retailer must first prepare and develop a plan to resume operations once the general negative impressions have subsided. The current crisis will inevitably end sooner or later, just as it has happened in the past. Retailers should therefore not panic, but in order to compensate for the fixed costs incurred during the troubled period, they will have to make up for lost sales.
Therefore, it is necessary to study how the product or service could be modified to adapt to the new circumstance, or if such a decision is necessary. Therefore, business owners must devise strategies to reach current and potential customers with a compelling message through the most appropriate relevant channels.
In this sense, retailers can effectively use street promotion campaigns near the store, flyers, point-of-sale advertisements and social media. In my opinion, a small or medium-sized business’ Facebook account can be an essential way to communicate with customers if it is solid, innovative and regularly updated.
Moving outdoors is a smart move when a retailer wants to increase foot traffic, which is the primary focus of retail. It can be quite successful to step onto a nearby sidewalk with a catchy statement that is perhaps relevant to the current situation. People can become intrigued and eager to check out when things are moved with a well-done perspective. It might even attract often indifferent customers.
Amazing effects will come from holding an event in the shop. Invite your customers while soliciting their help. The Sri Lankan culture is such that they will definitely not give up or neglect your efforts to recover. Instead of visiting the same half-hearted store every day, customers who have been depressed for a long time due to various recent incidents can even enjoy a stimulating and lively new setting. Many retail establishments use this strategy to attract customers during off-peak seasons or even during normal times.
To enhance the attractiveness of the event and attract more participants, the seller can also provide a suitable promotional item, perfectly suited or necessarily essential to the current circumstances.
Renovating the store is a good idea in this time of distress. Customers who have visited the store before will appreciate and admire a new layout and a more positive outlook. If you want to add unique decorations or arrangements to your business, you don’t have to be a talented designer.
Simple changes like moving furniture, painting the walls a different color, adding flower pots, etc. can make a difference. After a difficult period, the general public is looking for originality. As a savvy merchant, you can take full advantage of it to boost traffic.
Another positive step to take is to devise a simple, short-term financial plan to address pressing issues since you have already suffered from the Generalized Troubles. Find out about all the new and useful financial concessions through banks and other financial institutions that can support the plan. It is important to keep an eye out for any potential government relief initiatives that will be implemented to address ongoing economic issues.
It makes sense to review the tariff with your product suppliers in light of current circumstances. Retailers should keep in mind that they are also affected and eager to rebuild. Think of it as an opportunity to lower purchase rates so that if you’re successful, you can pass on some of the added benefits to your own customers. Along the same lines, the retailer can negotiate lower prices with service providers for things like equipment rentals, transportation, store rent, insurance premiums, and janitorial services.
Rationalization of operations
Reducing the cost of running your business is a good strategy. Finding ways to save money is more crucial than ever during a recession. By reducing operating expenses, organizations can achieve this, among other things. Outsourcing or subcontracting individual freelancers can be an effective strategy in this context. This can streamline some of the operational costs while increasing profit margins.
Because consumers are constantly looking for inexpensive and accessible solutions right now, reducing the cost of purchases is an effective strategy for surviving a downturn. However, when subsidizing, be careful not to degrade or diminish the quality of the product as this may matter more than the price difference. When buying a product, your consumers and prospects always want the best quality, even when buying at lower prices.
The challenge is to maintain quality while remaining competitive and profitable in your industry. With this approach, you can increase your customers and leads because in times of recession people want to acquire things that are inexpensive and accessible.
Finally, in times of crisis, it is difficult even for the most efficient retailers to perform in retail due to many restrictions. Reducing discretionary spending and increasing marketing and sales efforts will lead to survival during the crisis and potential growth after the dark clouds have cleared.
However, since retail is all about the consumer, beyond and beyond the ingenuity of entrepreneurs, small business entities need the support of others. Big companies can help them immensely through means such as longer credits, temporary price reductions and, most importantly, street promotions and even technology.
Likewise, the government also has an important role to play in the survival of retailers who make a substantial contribution to the national economy. They can provide financial assistance through special programs with the help of banks and other financial institutions. Perhaps they can promote policy changes to protect the retail industry.