Economic indicators should be heeded. But a weakening economy should not give you a reason for your sinking bottom line. If it does, then you may have just found the real cause for your bottom line: blaming it on the economy.

Factually, periods of economic distress are viewed as opportunities by leading businesspeople. A falling tide lowers all ships. You can make big changes in your market share if you can find a way to out-maneuver the competition while they are blaming the economy, cutting their marketing budget and sticking their head in the sand or being complacent.

Studies have shown that major corporations often made their largest gains in market share by effectively promoting during hard times, while their competition was slashing marketing budgets and laying off marketing departments. The first step which any firm should take once a downturn is detected is PROMOTE!

Too often people believe the “reason” they are having a particular problem is due to something that is happening elsewhere (and usually outside of their control). This is especially true in the business world.

Here is an example: Store A is doing very well until Store B opens up across the street selling the same kind of products. Revenues decline at Store A as Store B gets up and going. But – and this is a very important but – to the degree that the owner (and staff) at Store A attribute their decline in revenue to the existence of Store B, TO THAT DEGREE they will be unable to deal with it.Store A simply needs to step back and realize they have new competition and take concrete steps to retain their current customers and create new ones. Perhaps the owners or management of Store A need to:

Hire a marketing firm to survey to find out what the buying public really needs and wants, so they can improve their appeal to the public and customer retention. Find ways to make their marketing and advertising efforts more effective. Develop a positioning in the marketplace that sets them above the competition. Create a smart PR campaign that attracts a lot of attention at low cost. Generate an effective Internet marketing campaign to tap new resources. Or maybe they actually need to do some marketing for the first time!

 

The reason sales are down at Store A is NOT Store B. Sales are down because Store A did not effectively shift their own gears to keep their business afloat and prosperous.

That may sound simplistic, but when an executive or business owner places the blame elsewhere, this very act of “placing blame elsewhere” reduces his ability to devise effective solutions. It actually reduces his ability to think straight, because s/he is so embroiled in what is happening somewhere else.

If you were racing a sports car on a mountain road, you would certainly know you had to change gears to give you the maximum speed possible whether you were going uphill or downhill. You would easily defeat a driver who never changed gears regardless of the changes in the road. You would laugh at a driver who pulled over to the side of the road or puttered along when the grade steepened. Those drivers would never win. When the grade got steep driving up the mountain, you would downshift and give it lots of gas if you wanted to win.

The same is true in your business. This is one key element that sets a businessperson apart from the crowd – one’s ability to detect changes in their operating environment and make his or her business effectively compete in that recession, inflation or changed competitive environment.

Let’s look at one more example of this. A business considers it has “slow periods of the year.” One such period is the end of the year. Numerous professionals and businesspeople believe the end of the year simply is not as productive as other parts of the year. And of course they have statistics to back up this belief. Every year, December is just very slow.

Then there is the professional who decided he wasn’t going to have a slow December again. So, back in October and November, he figured out a few things to do for December. He reminded patients that most insurance companies do not allow you to carry over unused insurance from year to year. He offered his patients incentives to come in during the holiday season. He just plain worked on it so that his December was not a “slow period.” The result? He now no longer believes in “slow periods” and of course he has the statistics to back up this new belief.

You can always find data to match a belief. If you believe you are going to have slow periods, you’ll have them. Why would you generate the insight, focus and hard work to fix something that you “know” is not fixable? So just don’t fall for that one.

The same is true on a broader scale with “the economy”. If you believe “the economy” is the basis for your declining revenues, you are in more trouble than you need to be. Anything that is outside of your immediate control is just that: outside of your immediate control. Let your competition use “elsewhere” as an excuse to explain being broke.

Put your total focus on your internal scene, service your customers better, boost your marketing and get yourself busy improving things you can and should control. If you do that well enough, “the economy” will take care of itself.

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