After 5 long hours stood by the roadside that hot summer’s day back in 1988, I was beginning to doubt my chances. Bank Holiday traffic joining the M50 showed no interest in me. Could I get home? Could I even get out of Wales..?
I was learning the hard way about what to do when demand dries up. Trying to hitch when everyone else was thinking buckets and spades, was proving to be a bad idea. The previous day had been easy. But now cars were full of families and there was little appetite for picking up strangers; even though I was exactly the same person as the day before and was smiling at every passing driver.
With no other help to draw on, I wasn’t going to give up. But my luck had to change at some point. Or would it?
Such uncertainty and the swinging pendulum of fortune is the same in business. Customer demand is rarely constant which can cause much anxiety and doubt when orders unexpectedly dry up and cash stops flowing into the business. The process is all the more unnerving in the early years of business since there’s no historical trading patterns from which to forecast demand lulls.
What to do when demand dries up
Every business should have some kind of financial buffer for tougher times. However, since it’s never pleasant spending reserves, you also need to be able to draw from your own mental strength. Holding your nerve and staying focused on what makes your business perform is critical.
5 Action points
- First – since your business will be no different to the one that attracted high demand levels before the lull, you need to remind yourself that your product/service is sound. Don’t panic or do anything rash.
- Second – research what’s happening in the market (e.g. talk to customers) and learn the cause for the lull. In most cases you will find demand is affected by external issues outside your control. Don’t think everyone as a collective has suddenly forgotten you. One business I work with (Print Revolution) learn much from their paper delivery drivers because these people know how much paper is being ordered by all printers. When it’s quiet, they check to find is it quiet for everyone (this is typically always the case).
- Third – Use the research to give you peace of mind and/or construct sensible promotional offers that can be communicated to the market at low cost to create demand. Don’t sit around waiting for things to happen and don’t give away your work. Use this advice from Hubspot to help create your offers.
- Fourth – Ensure that the ‘sensible offers’ you make are justifiable for the moment in time and ensure they are time-bound so decisions to buy your product/service are made quickly.
- Fifth – Use some of the available time to work on the business (see this post from Rainmaker) and get things done that you can’t when you are busy.
In all my experience of demand lulls (they’ve happened at least twice a year for 20+ years), I find I get to the fourth action point only to find orders picking up quickly. And each time this has happened I have grown a little stronger and more resilient. And so now I’m better prepared and know what to do when demand dries up.
And so it was in South Wales. I was beginning to eye a place to sleep when after 5 and a half hours a car did eventually respond to my outstretched thumb. The driver was only going 30 miles but critically the lift re-energised my self-belief, determination to get home as well as confidence in people who might pick me up. And once we reached the M5 motorway lifts became far more frequent and I was home just before nightfall.
Key Learning Points: Persistence and resilience are common traits in successful entrepreneurs. Since demand is rarely constant (because of external factors outside your control) develop sound strategies so you know what to do when demand dries up.