Economic downturns aren’t easy, but taking action is the only way to make the best out of the worst.

One good thing about getting older is that you’ve lived a long time and experienced both good and bad times. That’s why this slowing economy is not as upsetting to me as it is to those who call me for my free half-hour consulting call or even the clients I work with one-to-one who haven’t been through a downturn like this before.

My family business was started in 1936 and now the fourth generation is hard at work there. What this longevity does is teach you the lessons you must learn and apply to not only survive tough times, but to ultimately thrive.

I was in my 20s and I was a very sales-focused young man when a recession hit in 1974-1975. It hit its hardest in my service area of New York City and the surrounding suburbs. You may remember a famous headline attributed to President Gerald Ford when New York City asked for financial help: “Drop Dead New York.”

Frankly, it was downright depressing to be living in New York at that time. There was ever-rising unemployment, a collapsing real estate market and a big downturn in the stock market. Sound familiar?

I went to my dad and began to complain about how the calls were slowing down and it was getting tougher to sell anything to anyone, especially the big-ticket items.

Dad smiled at me and said, “Bless the slow times.”

I replied, “What?!!!!”

He continued: “You heard me. Up to now, you’ve been getting away with being sloppy! Not anymore. From here on in, you need to maximize every opportunity you get and you need to be a whole lot better than you’ve been before in everything you do. And so does the whole company. Mistakes are no longer an option in times like these.

“Here’s the good news: The weak competition will typically go out of business because unlike the good times, which is like a rising tide that lifts all boats in a weak economy, the tide is headed out. Those who don’t see it or know how to survive and thrive will be stranded on the rocks.”

When I stopped feeling sorry for myself, I took his words to heart and, surprisingly, I found that, although a lot of people opted for repairs rather than replacement options, many other clients did do remodel work. The reason is because it wasn’t so easy to sell their homes and move anymore. That meant they had to redo their tired bathroom, kitchen or heating system.

Same Thing Again

And I suspect that the same thing will happen this time around. I have survived the downturn after the crash of 1987 and the Gulf War Recession in 1991, just to name a few. But when customers are ready to have service and install work done, will they call you?

During the severest downturn I had ever experienced, Dad asked me to look up a bunch of companies and see when they were founded. Much to my surprise, I found that some of our greatest companies were started from 1929 to 1933. “Pop, I thought you said 1929 to 1933 was the height of the Depression,” I said. “Yet, many of these great companies went into business during these terrible years. How could that be?”

He nodded his head and said: “Yes, it does seem strange at first glance. But looking back, it was the very best time to go into business. Real estate was dirt cheap, the cost of materials was inexpensive and labor was willing to work for less and they were much more productive because they were happy to have a job. For those companies who weren’t already saddled with too much debt, they were in a perfect position to be in business and thrive.”

The lesson wasn’t over. I asked Dad, “How did they find enough work?”

Once more he patiently answered my question: “Al, the best always find work. That’s why you need to become the best you can be and get recognized as being the best. The mediocre or worse will disappear in times like these. That’s why training never stops in good times or bad times. If you’re not getting better, you’re getting worse.”

Finally, he sighed and continued, “When you learn to see problems as opportunities, you too will ‘Bless the slow times,’ like I do.”

What about you? Are you preparing for the downturn or are you deluding yourself? Here are some ideas my dad shared with me that I know will help you first survive and then thrive in the slow times ahead:

Look at every expense the company currently has and decide as objectively as you can whether it’s essential or it’s just a nice thing to have. You will need to cut costs so you can put the money to work where it needs to be.

Maximize every sales opportunity you get.

Take this opportunity to reduce inventory and overstock of materials.

Train, train and train some more, so that when you do service work or install work, you make sure it’s profitable. Callbacks are too expensive anytime, but they’re even more of a killer in slow times when profits can become slimmer.

Begin to look around at your competitors and think about who could be acquired. If it’s tough times for you, it’s just as tough - if not tougher - for your competition. It’ll never be cheaper to acquire another company than now, just like real estate or stocks. What makes this an even better investment is you can make money with those sales because you don’t have redundant overhead costs (if you put it all under your roof).

Communicate early and often with everyone in the company about what’s happening and why. Let them know that not only will the company survive but, if there’s a plan, if the company is quick to react and make some tough decisions, it will actually thrive.

Keep marketing. The tendency of many companies is to cut back, but this is the very best time to market. You’re in the best position to negotiate with your marketing vendors and marketing company as their revenues begin to drop. Your marketing will actually make a bigger impact as the others cut back.

Think of these slow times as entering a tunnel. If you have an experienced guide, have planned well and are ready to execute the tough decisions quickly, there will be a beautiful light at the end of the tunnel. But if you choose to go it alone, stick your head in the sand and pretend it will all pass without taking action against these changing times, the light at the end of the tunnel must just be an oncoming freight train!