Despite the recession, it’s clear that some products are doing surprisingly well. Phillip-Morris tobacco products, McDonalds hamburger franchises, Wal-mart super stores, Kraft Foods, Johnson & Johnson, Costco Wholesale, Toy Industry Association companies and Novartis medical supplies are all faring quite well. “Some companies get healthier and stronger after weathering downturns,” says Vivek Wadhwa, founder of technology startup Relativity Technologies. Here are some anti-recession tactics and tips from some of America’s top-performing enterprises.
The most important of all anti-recession tactics is to understand the new problems your customers face and offer them innovative solutions. The most successful businesses are ones that can save customers money, make their lives less stressful and offer more value. For instance, one company developed a fast-curing resin to maximize productivity for injection-molding machines; yet, when the recession happened and greater output was no longer needed, the company switched gears and developed a less expensive, slower-curing resin, which was ultimately profitable. “We can’t add meat to a burger anymore,” admits CKE marketing chief Brad Haley, who oversees the Hardee’s and Carl’s Jr franchises. When times are tough, executives need to be more creative. He adds, “Carl’s Jr. is promoting a guacamole bacon cheeseburger. Avocados are a less expensive topping.”
One of the anti-recession tactics that many businesses fail to do is to keep investing in the core. One thing you cannot afford to do is let critical components of your business — like product innovation and customer service — fall by the wayside. When these dark days are over, you want your company to emerge like a butterfly out of its cocoon; you want people to say, “Even though the economy’s doing bad, this company seems to be faring well… look at all they’re doing!” Companies that stagnate now can never compete later. “We’re not going to cut innovation,” Intuit’s Brad Smith tells CNN Money Magazine. “This company, for 25 years, has been fueled by new-product innovation. We’re protecting the innovation pipeline so we come out of this strong.”
One of the common anti-recession tactics is to slash prices to move inventory. However, this does not always equate with profits. According to McKinsey Research, the average company that cuts prices by 5% would need to sell 19% more to pay for itself. Yet the price decrease decision also depends upon what customers are doing. In the gasoline industry, once gas hit $4 a gallon, US consumers cut back significantly on their purchases. This season the Wii and Playstation consoles will come down in price to reach a greater audience. “These past few years the game consoles, PlayStation 3 especially, have been a little bit out of price range for a Christmas present,” said Eiji Maeda, a JPMorgan Chase & Co. analyst from Tokyo, Japan. “The reductions make the PS3 and Wii within reach for more people and should spur sales.” Of course, expert tips indicate that innovation must also accompany their moves because no one will buy the console if new game titles are lacking.
About the Author:
Jamie Motior loves writing about anything and everything, he spends hours every week writing about a variety of different subjects from all walks of life. For a living, Jamie is a design consultant for a best video baby monitor manufacturing organisation, you can find out more information about Video Baby Monitors by visiting http:// babyvideomonitors.biz which document different kinds of monitors commonly available today.
One of Jamie Motiors favourite writing subjects is Hearing Aids, as he was born to the parents of two hard of hearing adults and is well aware of the difference in performance of the different technologies, and the difference they can make in the quality of life of the user.
