Economy Forces Businesses to Make Small Adjustments

by | Mar 28, 2023 | Business Finance, Small Business | 0 comments

Businesses have begun finding ways to save money or replace sales that might have gone missing.

As the economy slows down, businesses are facing the challenge of finding ways to save money or replace lost sales. In this uncertain economic climate, it’s important for businesses to have a plan in place to ride out the choppy waters. 

In a previous video, Senior Underwriter Dennis Cage talked about an expected ‘rolling’ recession and how small businesses can survive choppy economic waters.

In this video, he speaks to some more specific tactics small businesses can use to keep churning sales and potentially save money.

We also found some examples from companies you’ve probably heard of before. See what you can learn from the examples below, and maybe use them to your advantage.

Burger King in Michigan Closing 26 Locations

First the bad news. 

In a previous post, we talked about the looming business credit crunch. Seems like early victims have already been claimed.

An owner of 26 Burger King franchise locations in the Detroit, Michigan area announced their stores would be closing by the end of next month.

In a legal case against the franchisee, the franchisor stated they were owed monies related to the operation of the restaurant.

In a nutshell, business wasn’t going well, and they couldn’t get a loan to cover the costs. That’s 26 retail locations and the bank wanted nothing to do with any of it.

The credit crunch has arrived.

Walgreens Turning to Healthcare Services

In the video above, Dennis speaks to finding ways to offer more essential products or services to customers. 

Walgreens chose to do just that, after losing a major revenue stream due to the lack of demand for COVID testing and vaccines. 

The company invested in professional staff, increased store hours and leaned more into its healthcare services. While the pandemic has mostly passed, the events did put a higher focus on personal wellbeing and preventative care.

By taking advantage of opportunity, Walgreens finds itself primed to leverage other services preventing deeper losses to profits.

Target and Walmart Charging a Bag Fee on Pickup Orders

Target announced via their website, that in areas with sustainable packaging ordinances, they would charge a fee for plastic bags.

While Target had this policy in place for in-store purchases, it will now apply to pickup orders as well.

Walmart has also implemented a similar policy.

We’re not citing these examples due to the stores finding a new revenue stream selling plastic bags.

Both stores offer an option to go forego the bag and the fee. The real secret sauce in the move will be money saved when customers turn down the fee.

In tight monetary times, everyone is looking to save money—especially your customers. They’ll pass on the bag and the savings.

Don’t have plastic bag ordinances in your area?

Make the charge a sustainability fee. Your business will get credit for being socially responsible. Sell reusable shopping bags for a little more than cost.

You might be surprised by the response from customers.

Think about the cost savings of not buying plastic bags.

Driving Sales With Customer Loyalty Programs

Let’s look at another win for Target.

Have you seen the cost of eggs and milk over the last year? Prices for both have skyrocketed. Target offers both at a price less than the average in the area.

Here the retailer combines two techniques—selling needs and providing discounts to their most loyal customers.

Think about the brand loyalty created. Think about the added sales when neighbors inform friends about the deal.

New to Target? To get the deal you need to join the loyalty program.

Registration includes obtaining critical marketing information, and a willing recipient of bi-weekly or weekly sales emails.

Target store design means grocery buying will require walking into a store filled with consumer goods. Residual purchases are sure to happen.

Think about the value derived–in terms of cash flow and branding, from a simple discount on essential items.

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