After the past few years of covid-related business disruption, an upcoming recession is often the last thing people want to consider. However, even in the most difficult environments, there are opportunities for those who maintain a growth mindset.

Many firms will be rationalising and cost-cutting to “batten down the hatches” and get through. They will be looking at areas that are performing poorly and seeking to pull back where they can. 

Unfortunately, some will not survive even after doing this. However, this situation also provides opportunities for businesses to consolidate with others in their industry, and improve market share.

Investigate mergers

It’s been a difficult time for some business owners. Those who struggled during the pandemic may not have the energy to deal with the thought of a recession. They might simply want to exit the market, bringing opportunities for competitors to take over an established entity and grow both enterprises.

Rather than maintaining two separate, struggling companies until the bitter end, investigating the option to merge with (or acquire) competitors early on can make good business sense, and spell a stronger future for both organisations. 

This also presents the option to complement your existing offerings by moving into new markets, products or services while other companies are doing the opposite.

Invest in talent

Another struggle many have faced over the past year is finding good employees. In a recession, some businesses will be restructuring and offering redundancies, leading to an increased number of qualified people seeking employment. This can make it a good time for businesses who are looking to invest in talent.

Smart businesses will recognise where skills can be transferred across industries – for example, analytical and coaching skills are now increasingly in demand in the tech industry to support the explosion of cloud technologies in New Zealand, despite the downturn in other parts of the sector. 

Streamline operations

Businesses who are looking to make great hires, and who are willing to invest in a little retraining and development, may find the next 12 months a good time to recruit, especially as new employees can bring additional customers or contacts to help with growth.

During a slow period, businesses can also use the additional time to streamline operations, whether it be improving processes that increase efficiency and productivity or enhancing the quality of your product or service.

While ChatGPT may or may not be the silver bullet for your business, it’s well worth exploring technology to automate time-consuming processes. 

These investments can actually reduce costs rather than add to them, while boosting productivity and simply making life easier for people on the ground.

Innovative culture

Using quieter periods to invest in training your employees can also increase engagement and productivity, providing them with a sense that they are continuing to develop professionally and advance their careers even if promotion or large salary increases aren’t an immediate possibility. 

Engaging your staff in ways to improve the wider business can have the same result, creating greater buy-in and supporting a more innovative culture that enhances the sustainability of your business in both the short and long term. 

The old adage, “work on your business, rather than in it”, can be difficult to do when business is booming, but down times provide the kind of space to really come to grips with where improvements could be made. 

Recession mindset

Bringing in external advisers to support in this process and refresh your approach is also a valuable exercise. 

If you can introduce key changes during the slowdown, your firm will be able to grow when the economy bounces back and take advantage of further opportunities.

A company leader's mindset approaching (or in) a recession can make all the difference to how a business meets the challenge. 

The message to business executives is to keep an open mind, look for possibility and opportunity, and use time wisely by making investments in your people and processes. 

This will help make the tough times easier, and when the good times return, they will be so much greater.