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Market cycles often provide an opportunity for leaders from all walks of life—be it real estate, technology, finance, healthcare, or a range of other industries—to scale and redirect their businesses, prioritize talent, and reclaim market share. In times of market downturn, entrepreneurs may need to adjust their approach to see their teams and clients in a different light. Surviving a recession is a challenge for businesses at any stage, but it is achievable.
Throughout my career, I’ve faced economic uncertainty while working in real estate, weathering the storms and becoming more competitive than ever. Here are some tips to help you keep up with the times and grow your business even in times of uncertainty:
On the subject: 3 ways to adapt and grow during a recession
Take a calculated risk
An important trend to keep in mind as part of your business plan is understanding and anticipating how your industry is reacting to a down market. For example, when the real estate market starts to get cheaper across the country, the capitalization rates or the expected rate of return on investment properties starts to rise. Our current strategy is to collect as much real estate as possible across the country, including in Georgia, Oklahoma, Texas and Utah, and take advantage of the weak market and recession when other investors are more hesitant and less risky.
But we believe we can hedge our risks by being prudent and researching these emerging markets. What weaknesses in your industry can you exploit? Is reduced demand causing lower prices for spare parts? Will increased demand drive up the price of your products or services? Conduct a landscape audit and see where calculated risks can be found.
Rotate if needed
I have been in the real estate industry for over two decades and witnessed the Great Recession of 2008. At the time, my previous firm was investing in industrial real estate, which quickly fell in value as the market crashed. Instead of closing the store after the sale at a loss, we figured we could stay in business by focusing on retirement housing, seniors, and memory care facilities.
We learned that it was a more stable investment, so my team and I believed and successfully changed course. Business development is critical to maintaining momentum; if you don’t grow, you die. Thinking ahead, innovating and being one step ahead is essential to maintaining momentum in turbulent times.
On the subject: 5 ways to support company growth during a recession
Lead with Vision
As a business owner, regardless of your industry, understanding how to navigate during times of chaos like a recession is critical to your company’s survival. While the path ahead isn’t always crystal clear, staying in touch with your guidelines will help you navigate any uncertainty you may face as a business owner.
If you’re not sure what those principles are, tune in to your “inner voice” and make sure the decisions you make are in line with your values as well as those of your business. Make sure your team members have a clear understanding of your company’s mission and vision to maximize company-wide alignment.
Develop your team
What to consider is to continue to grow and invest in your team so that you are ready for when the market cycle picks up again and business returns. Your people are the engine of your business. With continued layoffs across industries, there could be a growing pool of talent. During this recovery period as you innovate your business and expand your company’s capabilities, make sure you have the right talent. I offer tips on how to attract the right team members in a previous Entrepreneur article.
Keep in mind, strengthening your business in terms of talent doesn’t necessarily mean hiring. Instead, it could mean reminding current employees of your company’s values, as well as sharing your business model and vision for the future with them.
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Remember that market cycles are temporary.
A recession should not necessarily be viewed as a bad thing; for me, this is an opportunity for entrepreneurs to build and adapt, taking themselves and their teams to the other side and to a better, future market cycle. All market cycles are temporary, so this too shall pass. Issues such as lower property prices, higher interest rates, economic uncertainty and market volatility are cyclical.
No matter what industry you’re in, you can learn from and grow out of something negative like a recession by growing your business, changing it as needed, investing in the right people, and just riding the storm in the hope of a clearer and brighter future.