The Best Ways to Recession Proof Your Business

With the state of the economy right now, many businesses are getting flashbacks to 2020 and 2008. Many are wondering how they’ll survive if the current crisis becomes a recession.

Yes, many businesses have shuttered during tough economic times. There’s no foolproof way to do it, but we’ve compiled a few easy steps to make your business recession proof.

Are we in a recession?

If by “recession” you mean “bad economy,” then sure. A recession is defined as “a significant, widespread, and prolonged downturn in economic activity.” That might sound familiar, but technically, we’re not in a recession.

Why not? On the one hand, a classic marker of a recession is two consecutive quarters of negative GDP. That happened in the US in 2022.

But on the other hand, a number of major economic indicators have managed to stay positive. America’s GDP has bounced back. The stock market is… volatile, but currently doing okay. Unemployment remains at an all-time low.

Will there be a recession?

You’d have to be pretty divorced from reality to argue that the economy is doing great right now. Looming threats ranging from war to student loans could send it over the edge. But 3+ years into post-pandemic troubles, the US has so far managed to avoid a recession.

If you feel like your profits have dried up, you’re not crazy. Costs are high, banks are collapsing, and everyone is having trouble. That’s why recession proofing your business is still useful.

5 ways to recession proof your business

If you’re a business owner concerned about the economy, these 5 tips can help.

1) Find low-cost solutions

Survive a recession by saving money. Brilliant, right? But this isn’t just about cutting temporary costs to weather the storm. To truly recession proof your business, you need to set up for the future.

Some businesses choose layoffs and department closures when times are tough, but this shouldn’t be your first resort. For starters, see about scaling back your operating costs. Consider migrating to cloud storage, or finding cheaper software alternatives.

For example, many businesses rely on freelancers to supplement their creative team, which can start to add up when you need a lot of designs. You might find that you save money by switching to a subscription-based graphic design service like Penji. Check out our review to see why we recommend it. You can also sign up with our special 35% off promo code — PREP35.

2) Put people first

In a recession, you may have to scale down your business operations, and that can mean letting people go. But if you intend to survive the recession, mass layoffs may do you more harm than good.

A business is made up of people, and each worker plays a role in developing your brand’s unique personality. Layoffs can sour long-term relationships, but they can also change who your company is on a fundamental level.

In a recession, some downsizing might be inevitable. But to recession proof your business, aim for transparency. Talk to employees about your difficult decisions, let them know where you’re cutting costs and what prospects may look like down the road.

3) Rethink your architecture

Every application has an architecture. If you produce tech, you can recession proof your business by rethinking how you deliver it.

For example, you may consider a microservices architecture, which is sometimes less expensive than a singular (“monolithic”) setup. This considers each element of your service as its own mini-service.

For instance, an ecommerce site might use different services for accessing a user’s account, their shopping cart, and processing their payment. The user still sees one website, but under the hood, they’re accessing different services.

4) Demonstrate your value

Chances are, you’ve already given a lot of thought to what, exactly, your business offers. It should be at the core of all your marketing materials, your whole brand strategy.

But to recession proof your business, you’ll need to double down. It’s not just, “What can we do for you?” It’s, “Why do you need us?”

Some of the best ways to demonstrate your business’ value include:

• Money saved
• Life improved
• Everyday problems solved
• What sets you apart from competitors

5) Be flexible

On the one hand, you want to hold onto your business fundamentals to survive a recession. Your people, your values, your product. But when something needs to change, you can’t afford to be too precious about your current processes.

Be willing to make changes, but make informed ones. Test out new messaging, new products, new pricing models. If your ads are losing ROI, it might just be a sign of the times, but it’s worth looking into different strategies that could give you a boost.

You might think that in order to recession proof your business, you need to avoid showing signs of weakness. The fact is, the most stubborn businesses are often the first to go.

Markets change a lot during a recession. When you come out the other side, you want to be ready to meet whatever new challenges come your way.