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The coronavirus pandemic caused unprecedented challenges that few entrepreneurs could have ever predicted or planned. As society moves toward re-opening, some economic experts are worried about an impending recession and what that might mean for US businesses.
Business owners who survived the 2008 financial crisis have some experience with operating during a recession that could certainly come in handy. If you launched your business sometime after then, it doesn’t mean you have to face the economic downturn alone.
While you can’t recession-proof a business, you can take steps to increase your company’s financial stability and adjust to changes in consumer behavior. As you start to prepare your business for a recession, consider tracking these invaluable business metrics.
Global trends can give you a macroeconomic view of consumer and industry behavior. However, it is also important to look at regional trends—as not all parts of the US are affected equally.
Along with global trends, you should keep an eye on certain financial metrics within your business. These can alert you to any potential problems with your operations. Below are a few key metrics to monitor.
The smallest metric to track within your business is customer behavior. Your target audience can give you warning signs about your business even before the economy goes south. Use these metrics to make adjustments based on your customers’ activities.
While these business metrics can guide your decision-making in the lead-up to a recession, they should not cause you to panic or dramatically change your business model. Make sure you have a strong financial backbone and adapt to market changes so you can withstand any upcoming economic stress.
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Derek Miller is the CMO of Smack Apparel, the content guru at Great.com, the co-founder of Lofty Llama, and a marketing consultant for small businesses. He specializes in entrepreneurship, small business, and digital marketing, and his work has been featured in sites like Entrepreneur, GoDaddy, Score.org, and StartupCamp.
Blog
9 min read • Aug 15, 2022