December 20, 2018

Outrunning A Recession

No, you aren't going to be able to outrun a recession. 

Not by a long-shot.

But you can position yourself to weather the recession better than your competition.
  1. Make sure your Inventory Management Team is not buying to forecast. The last thing you need to do is mark down good merchandise because you didn't plan ahead.
  2. Instead of discounting in the short-term, over-invest in marketing. The goal is to get through inventory now and get new customers in the process ... it's better to lose money acquiring a customer than to lose money via discounts/promotions ... the former gets you a new customer, the latter gets you a new/existing customer who expects to never pay full price again.
  3. Be ready to then reduce marketing spent at a moment's notice. Know exactly where you can reduce marketing spend with virtually no impact on the total business ... y'all have cases where you are spending money and not obtaining a return on investment ... be ready to pull those dollars immediately, protecting your profit and loss statement.
  4. Stop expensive marketing among customers with high return rates ... why churn merchandise during a recession? If the customer has a high return rate, shut the customer down. Let your competition deal with unprofitable transactions.
There's probably 22,000 different ideas and tactics. Get your grease board out, write down the ideas / tactics, and begin executing the minute your metrics suggest you are headed into a recession.

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