From mortgage crisis to credit crunch…looks like what was expected to be mainly a problem of Wall Street and those overextended in their mortgages, has come to bite small businesses in the back door.
According to National Federation of Independent Businesses (NFIB), a year has passed since the Federal Reserve declared the existence of a credit crunch. While I saw significant indications of a downturn last November, and even prognosticated pending economic changes to near strangers, even I missed that important message.
Now I understand why so many large businesses have been drawing down on their credit lines over the past six months!
So, where does that leave you…the small business owner?
One of my favorite marketing organizations, MarketingProfs, is hosting a webinar on October 10th titled, “Marketing in an Economic Downturn: How the Current Wall Street Crisis Will Affect Professional Marketers.” Could provide some interesting insight.
In the meantime, Seth Goldinpoints out by example that as tempting as it may be to try to recoup your losses by raising prices with existing cusotmers…don’t!
In Seth’s case, it was an insurance company’s repeatedly raising his rate for not reason. Sound familiar?
If revenue increases enough to make up for the few who quit, you come out ahead. So, quarter after quarter, year after year, repeat the same process. Raise it a little, check to see if revenue rises in aggregate, and repeat. I’d get the bill, sigh about the fee, consider the hassle of switching, pay the bill and move on. Until last week. Last week the number was too high.
Push customers too far… they are customers no more.