Pepperdine Graziadio Economics Practitioner Brandon Parsons Discusses Small Business Strategies with Potential Recession on Horizon in San Fernando Valley Business Journal

“The pandemic really forced businesses to become more efficient, so I think a lot of them are going into a potential recession being pretty nimble. In many cases, they’re potentially coming into the recession in a better place.”

In preparing for a recession, Brandon Parsons said it’s important for business owners to align their expectation with demand. Although consumer purchasing power remains relatively high, inflation and concerns of a downturn are starting to affect that, he said, so a smart enterprise will adjust and offer similar products at a more economical level than their premium counterparts. To give an example, Parsons posited that consumers may opt for a generic dish soap as opposed to flashy and performance-marketed brands.

For enterprises that have longer-term relationships with their clients, it also helps to be proactive in contacting those clients and seeing what they can do to help out their wallets while still providing services.

“Keeping your current customers happy is really important,” he said. “Just going the extra mile for your existing customers can go a long way in retaining your current revenue stream during a recession.”

And while they’re being proactive, businesses also stand to benefit from making sure they stand out to potential new customers.

“There’s a tendency for firms to dial down marketing during recessionary pressures,” Parsons said. “That can be a mistake, especially given the need for firms to really differentiate their products relative to competitors when customers are more price-sensitive.”

Read the full story here.