How to Make Your Agency Recession Proof

Jennifer Payne | October 6th, 2017

Recessions come and recessions go. They are a very natural part of a healthy economy and business cycle — a cleansing of sorts or a reset on industries and values. If you look at it historically they occur on average about every 5-8 years and they last between 8-18 months. In fact, the average duration of the last 11 recessions between 1945 and 2001 have been 10 months.

Looking back
The last ‘Great Recession’ in 2008-2009 was the worst since the 1929 Depression. It was also the longest since that Great Depression, lasting 18 months (December 2007 – June 2009). Historically it was overdue in terms of recession timelines, but was massively aggravated by the subprime crisis which then tripped up a global banking credit response. So many great articles, studies and opinions have been written on this subject, so I won’t spend any more time roasting that chestnut. I would rather look at: 1) how to prepare for the next one, 2) tips to make your business recession proof, 3) and how to grow your business while in it.

Looking forward
Purely based on historical events and economic indicators, we shouldn’t be surprised if by 2019-2020 we are knee deep into our next one.  Will it come? How bad will it be? Could history buck a trend?  There is no crystal ball, but patterns support a spending slowdown, low purchasing, greater uncertainty, adjustments on housing, and a bullish market — all of which translate to less importing. Whenever it happens, this recession will most likely not be as big as the last one, but will have a larger impact on global partners.

Although the thought of a recession conjures up anxiety, we can actually use this time to make money, invest, start a business, and gain strength coming out of it. Here are a few pointers that got me through the last few recessions.

Rule 1: Continue to pay attention to your business or industry.
Watch how it is being affected and how your competitors are weathering the storm. Also remember that the media will over exaggerate and create hype. Just remember that it usually is not as bad as it seams and will eventually run its cycle.

Rule 2: Be business smart and competitive.
Some of the businesses that impressed me the most coming out of 2009 were well established companies, like Nordstrom or Starbucks, who found a way to grow in a down market.  They did this through revising what they provided to customers and by providing more basics, but not giving up their core offering.

Rule 3: Be liquid and take advantage of an opportunity.
If you can secure a loan now, do so.  The best time to get a loan is when you don’t need it. Having access to a line of credit will allow you to weather any bumps in the road.

Rule 4: Do what you are good at and provide great quality.
The irony of economic recessions is that last-movers, knockoffs, discount services, and product providers surprisingly don’t do well (contrary to what you may think).  Most of their business models are built with slim margins which makes any bump in the road feel like a cliff. It is why Louis Vuitton survived and the readily available NYC street knockoffs shrunk.

Rule 5:  Provide a service or product that people NEED (not just want).
It is argued that in cost cutting situations, the luxuries go first.  Yes they may shrink, but people still want them (look at Nordstrom and Starbucks). If your business allows, look at what kind of basic services or products you can provide without hurting your brand promise.  Also look at adding monthly maintenance agreements, monthly monitoring programs, or repetitive income if you can.  When we had our agency (Pelago), we added these services to help regulate cashflow. And now with Intervals we are able to move completely away from one-time contracts and into more predictable and recurring monthly income.

Rule 6: Take comfort realizing that there is nothing you can do to stop a recession, and that they all end — eventually.
Recessions, like booms in the economy, will come and go. Don’t take it personally. Take advantage of the fact that recessions will weed out competition. If you want to start a new business, pick an industry or product that people need rather than want.


In 2008, in the heart of the ‘Great Recession’, we had one of our top single growth and signup periods for Intervals, our online time tracking and workflow software, ever.  Regardless of the idea that people don’t spend money in a recession, they will if you present them with the right product, at the right time, for the right value. The right product will either provide a solution to a problem, or will need to trigger the right emotion for someone to want it (that newest pair of Nike shoes).

Our promise at Intervals was (and is) that it will take the emotion out of business decisions by giving you the data to identify areas of wasted time and least profits.  Our value was simple, we will give you the tools to watch your business more carefully, and enable you to save money and bill more hours. If you look at it this way, you only would need to bill one extra hour of work a month to cover the cost of using Intervals.

How can you prepare for the next recession

  1. Is your current business recession proof?  If not, what can you do to start changing now, before we have the next recession. Is there a simple pricing change or should you invest now in building a new product or service. It is far easier to launch a new service or pricing in an up economy.
  2. Look at your business and see what value you can provide to others in a down (as well as an up) economy and then work hard to market those values.
  3. Can you find a niche that provides unique value? Start building the skills, knowledge, and connections now. Don’t wait for the recession to make the decision for you.

There is no guarantee when the next recession is coming, there is however historical data, economic signals, and everyone’s opinion. There is not much we can rely on 100% except that recessions are normal. One may come next year or may arrive in another 10 years. But eventually we will have one. When the next recession does arrive, consider it an opportunity for growth.

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John Reeve
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John Reeve

John is a co-founder, web designer and developer at Pelago. His blog posts are inspired by everyday encounters with designers, developers, creatives and small businesses in general. John is an avid reader and road cyclist.
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Jennifer Payne
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Jennifer Payne

Jennifer is the Director of Quality and Efficiency at Pelago. Her blog posts are based largely on her experience working with teams to improve harmony and productivity. Jennifer is a cat person.
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Michael Payne
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Michael Payne

Michael is a co-founder and product architect at Pelago. His contributions stem from experiences managing the development process behind web sites and web-based applications such as Intervals. Michael drives a 1990 Volkswagen Carat with a rebuilt 2.4 liter engine from GoWesty.
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