How Manufacturing Can Join the Ranks of Recession Proof Industries
While it is impossible to predict the market, there are indicators that the next recession is on the horizon. Forbes published “Another Warning that a 2019 Recession is Coming” to describe how times of economic slowdown are often preceded by growth and record levels of household wealth to income ratios, which we’re now seeing. Put another way, the current bear market for stocks has strengthened economists’ belief that there will be a recession this year. With these predictions in mind, here are some tips to create recession proof industries now, before recession hits.
3 Ways Manufacturers Can Become One of the Recession Proof Industries
Generally speaking, even if the impending recession is milder than the one felt a decade ago, businesses of all sizes will be tightening their belts in response. According to Investopedia, the first things to be axed or severely limited are hiring, research and development, marketing and advertising. But before you make any rash decisions, there are ways to prepare your manufacturing business for a downturn.
1. Increase Innovation to Manufacture New Products
As with all industries, innovation and constant improvement are key to remain competitive. You already employ technically-minded and creative individuals, who are well suited to proposing new products for your business to develop. Continuing to diversify the products you offer will help bring in more revenue, protecting against any slowdowns or lost customers.
Consider expanding into industries that are relatively recession-proof, in order to increase revenue streams from reliable sources. Examples of industries that do well during a recession are:
- waste disposal
- discount retailers
- alcoholic beverages
- candy companies
2. Expand Into International Markets
Another method of diversifying your business is to expand into international markets. The obvious and closest neighbour is the U.S. There are simple ways that you can adjust your current marketing strategy and website to attract U.S. manufacturing customers during a recession. For instance, you might consider:
- Creating a recognizable brand for this new potential customer base
- Using your content to explain where US customers easily fit into your brand
- Reorganizing information on your website to make it easier to find for your new target audience.
The Business Development Bank of Canada (BDC) also recommends investigating business opportunities in Western Europe where cultural and economic business ties are strong. If Canada or the U.S. is hit hard by a recession, new or growing clients might be easier to find in Europe.
3. Increase Qualified Leads to Grow Your Customer Base
Although one of the knee-jerk reactions to a recession is to cut marketing and advertising, it’s actually where you want to be focusing your efforts to grow your overall customer base. One in six well-established Canadian businesses have encountered financial difficulty when losing just one customer.
You can start protecting yourself today by investing in marketing strategies that are proven to pull in qualified leads, like inbound marketing. Inbound marketing increases your customer base and lessens the blow of any lost customers during a recession.
Use Inbound and Growth Driven Design
Inbound marketing and growth-driven website design (GDD) are some of the most cost-effective methods to increase qualified sales leads.
Essentially, inbound marketing does the leg work for you by continuing to collect qualified leads after you’ve producing tailored content on your website. Inbound marketing relies on SEO strategies to attract the right clients - your target audience - to you. You will then be free to spend your time leading the company through difficult times, rather than investing additional time (and money) in networking or trade shows.
You can also hire an inbound marketing agency to execute this strategy for you and attract new customers from recession-proof industries (such as healthcare or pharmaceuticals). When you hire an agency, you get a team of six for the price of one marketing VP. You can even outsource to an inbound marketing agency that specializes in manufacturing marketing and sales.
Your website will become an efficient sales machine when you develop a growth-driven website that supports inbound marketing. Growth-driven websites allow you to rapidly update your product offerings and innovations as you adjust to the economic climate and are focused on continuous improvement, analytics, and feedback. These features ensure that GDD is working for you and your sales team, which is another investment sure to pay off as you diversify your customer base.
Turn Your Website into a Sales Engine
Whether during an economic recession or during economic growth, GDD - and inbound marketing - work for your sales team. Check out more recession proofing tips here.
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