In this post, we’re going to look at 8 steps you can take to fortify your business and protect your earnings during a financial crisis.
The best time to prepare for a recession is before the economy ever gets to that point. That’s not always feasible though and that’s okay. Now is as good a time as any to start working on protecting your design business.
8 Strategies to Recession-Proof Your Business
While the focus of this post is what to do to stave off the negative effects of a global or national recession, the strategies can also be useful when it comes to your personal life. So, think of these as survive-and-thrive strategies for all types of financial crises.
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1. Choose a Plan Over Panicking
It’s natural to feel stressed when everyone is talking about a recession or when you start to notice the cost of everything going up. Of course your mind will start spinning with all the negative possibilities of what’s to come.
But panicking can lead to hasty decisions that make things worse.
Instead of allowing your emotions to run rampant, take a breather. Go for a walk, go to the gym, do something that takes your mind off the situation. It’s also a good idea to sleep on it.
Then return to it when you have a clearer head.
You know that hard times may be coming financially. You don’t know how much you’ll be impacted nor do you know how long it will last. Focus on what you do know and what you are able to control:
- How much money do you have saved up?
- How much money do you know you’ll earn in the next few months?
- How much do you have in business expenses each month?
Take note of where you are right now. Then figure out a plan.
For instance, if your earnings decrease, are there expenses you can cut until things return to normal? You can also look at the state of your client list. If you’ve lost a client or you know one of them is about to cut back on how much they’re spending, start applying for new design gigs so you have something to replace the lost wages with.
2. Create a Budget
Gary Vaynerchuk recently suggested that people put off making big purchases for the near future. He also recommended getting rid of smaller expenses that are more of a luxury than a necessity.
Not spending money at all isn’t a realistic plan, even during a recession. In order to keep your business up and running, you’re going to have to spend some money. And in order to live a comfortable life, you’ll have to do the same.
The trick to spending money in the lead up to and during a recession is to set a budget and stick to it.
If you’re not already in the habit of creating a budget, now is the time to do so. It’s a good idea to have one for your web design business as well as a separate one for your personal life.
Start by looking at all of your expenses. Identify the stuff you need, the stuff that’s nice to have, and the stuff you can live without.
Add the stuff you need to your budgets. Then take a look at your current and projected earnings. If you have a lot of breathing room between how much money you make and how much you spend, then you can add in some of the nice-to-haves.
Don’t forget about saving money. While it might be tempting to spend whatever profits you have on stuff that makes you feel good, it might feel better to bulk up your savings account so you have something to fall back on if times get really tough.
3. Become More Efficient
One of the ways to widen your profit margins — even if less money is coming in right now — is by becoming more efficient in your work.
There are various ways to do this.
One thing every web designer should do is to set their website up to work on their behalf. So in addition to advertising your services, it should streamline your lead generation and sales processes.
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It would also be beneficial to create a web design toolbox of your own. This would involve:
- Choosing a CMS or two that you prefer to build websites with.
- Finding a few multipurpose website themes or templates that you can use to speed up the design process.
- Finding a set of trustworthy plugins or extensions that provide critical functionality for websites.
The more of this you get sorted out, the less time you’ll have to spend looking for design resources while you work.
Another thing to do is to get super organized in how you work. Start by documenting your process and saving your workflow checklists to your task management software.
If you don’t have one already, use a tool that displays your process checklists in a format that works best for you. Trello and Asana are both good options as you can organize your tasks using a variety of formats (like boards, timelines, tables, etc.).
Bottom line: The faster you work, the higher your profit margins will be. So find different ways to speed things up while simultaneously reducing errors and obstacles in your workflow.
4. Diversify Your Areas of Expertise
There really is no such thing as a recession-proof niche. Take something like the restaurant industry. I used to write about restaurant marketing and tech prior to 2020. Never had I imagined that that particular segment of my business would be wiped out. But the events of that year weren’t something any of us could have imagined would happen either.
So while no industry or niche is 100% safe, there are some industries that have a tendency to weather turbulent economic times better than others. According to Investopedia, those industries are:
- Real estate
- Telecom, internet, and media
- Consumer staples
As a web designer, chances are good that you have a niche you spend the most time working for. If it’s based on your design specialty (like graphic design, UX design, etc.), then you might not need to diversify your income.
However, if you work for specific industries or types of businesses, then you might want to explore additional niches. If you can work your way into one of the more resilient niches above, that would be a good place to start.
Note that this isn’t meant to replace your primary area of expertise. You should do what you’re good at and what makes you happy. However, having a backup niche can be helpful if your main niche takes a hit during a recession.
5. Make Yourself Indispensable
When your employers or clients start looking at areas in their own businesses to cut costs, you don’t want your services to be one of them.
You won’t be able to beg and plead your way into getting someone to pay you for something they don’t have the money for. What you can do, however, is make yourself so valuable that they won’t be able to let you go.
This particular recession-proofing strategy will have to begin long before a recession starts. That’s because it requires you to do long-term relationship building and skills enhancement. That said, even if you’re in the midst of a recession right now, there’s no reason to wait until it’s over to start working on it.
There are a number of things you can do to make yourself indispensable as a web designer.
The first is to stay up-to-date with what’s going on in web design. In addition to mastering the latest design trends, you should also have a good understanding of what’s happening in the space. For instance, if there’s a big Google algorithm update coming down the line, you should be preparing your clients for it as early on as possible.
Strengthening your skill set is another great way to make yourself an essential asset. Taking online courses or tutorials to learn how to use new design and coding tools or techniques is good.
Enhancing your soft skill set is also important. For example, there are some soft skills that can help you go from being a web designer to a valued partner. If you want to know what those are, listen to what your employers or clients complain about most.
Are they tired of working with people who miss deadlines? Who underdeliver? Who go weeks without communication?
Find out what matters most to them and then adopt those qualities and skills.
6. Create Service Bundles or Subscriptions
Have you ever decided not to buy something because it seemed too pricey, only to change your mind when you saw it was part of a bundle? There’s a reason for that.
According to research out of the University of Chicago:
“[W]hen multiple products and services are combined and offered as a single unit, consumers view—and, more importantly, value—the resulting entity as a unique ‘whole’ that is greater than the mere sum of the parts.”
So if you’re looking for a way to keep your website design rates high during an economic crisis, try repackaging your services into a bundle or subscription.
For instance, let’s say you typically charge $3,000 for a WordPress website or redesign project. During normal times, clients are willing to pay that rate without issue. They’re also willing to pay for your ongoing website maintenance services for an extra $200 a month.
Rather than offer these as two separate services, bundle them together. You could charge a single discounted fee that gives clients a website plus a year’s worth of maintenance.
You could also spread out the cost of the website throughout the year. So rather than require that the site be paid for by the time you publish it, you’d set your client up with a monthly subscription (like a payment plan). For instance, you could charge $250 a month for a year (plus whatever you’d tack on for monthly maintenance).
Before you go repackaging your services, though, talk to existing and former clients about what they find most valuable. You want your bundles to be attractive options even in the middle of a recession, so everything included in the package or subscription fee should be of value to them.
7. Start a Side Hustle
Having another income stream can come in handy during a recession. Even if it’s not a ton of money, just knowing you have extra money coming in when web design work slows down can be good.
Adding a new web design niche or specialty (like offering branding or SEO on top of design) is one way to do this.
Another thing to do is sell affordable digital products and assets. As a designer, there are different products you can create and sell. For example:
- UI kits
- Icon sets
Platforms like Envato make it easy to distribute and sell digital products to a large market of customers.
You can also monetize your knowledge. There are a couple of ways to go about this. One is to sell your professional workflows, templates, and shortcuts as reusable templates.
The other option is to write or film tutorials demonstrating different things that designers, marketers, or business owners would benefit from. You can then monetize that content by publishing it to a platform like YouTube or by adding affiliate links to it.
Just as you don’t want to wait for a recession to get into a new niche, don’t wait to start your side hustle. If there’s something that interests you and that you know there’s a demand for, start it up now.
8. Work On Your Website!
You know all those excuses you make about being too busy with client work, chasing down leads, and tackling admin tasks to do anything with your site? The second you experience any downtime before, during, or after a recession, get to work on your site.
One thing I’d suggest is to keep a running list of all the things you want to do that you haven’t had time for. This could be things like updating info on the home page, refreshing the site design, or changing your headshot.
You can also keep a list of things to check on as part of your regular website maintenance. For example:
- Update the portfolio with your latest work.
- Add new services or products.
- Write content for your blog or newsletter.
- Test the links on your site and fix or remove broken ones.
- Find new opportunities for internal linking.
- Test your lead generation and sale forms to ensure they’re working and optimized.
- Automate website processes wherever possible (like connecting your lead gen form to an online scheduler and Zoom).
It’s also a good idea to do some search engine optimization. This way, you can spend more time doing design work instead of looking for new jobs or gigs.
Google’s suite of analytic tools will tell you where your site could use some improving:
- Review PageSpeed Insights for recommended technical SEO fixes.
- Review Google Analytics for insights on individual page performance and see if the navigation or internal link structure needs fixing.
- Review Google Search Console for potentially missed ranking opportunities.
Although these might not be revenue generating activities at the time you’re working on the site, the updates you make will pay off down the line.
Whether you’re currently feeling a squeeze on your business due to inflation or a recession, or you’re worried that it’s about to start hurting your bottom line, now is the time to act.
Remember: The strategies above aren’t just useful in mitigating the losses that can occur during recessions. You can also use them to help you navigate the choppy waters of personal crises that impact your business and your ability to earn.