When the 2008 recession hit, Roger Blanchette couldn't have found himself in a worse industry.
Blanchette is president and co-owner of Montreal printing firm Quadriscan Group, which has 75 employees. The downturn hit printers especially hard, due to the migration of readers and advertisers from print to the web that was gaining speed at the same time.
Thanks to some forward-thinking investment in new technology during the previous downturn in 2001, Blanchette managed not only to survive the recent economic mess but also to position his firm nicely for a recovery. That investment nearly 10 years ago started with a strategic plan that led Blanchette to refocus his company and add digital printing to his line-up of services. It has paid off.
"It wasn't an easy time to invest, but if we hadn't invested, we would have been in big trouble now," says Blanchette, who has received BDC Financing and Consulting services.
True to form, Blanchette has just embarked on another shift in direction in a slow economy. He's creating a print-on-demand venture to target the Quebec book market.
Theodore Homa, a managing partner at BDC Consulting in Montreal, likes Blanchette's strategy of thinking ahead. "The recovery is coming. You need to prepare for it now, because if you wait until it's in full swing, it will probably be too late," Homa says. "Your competitors will have acted ahead of you."
Here are Homa's tips on positioning your business for the rebound:
- Develop a strategic plan. You need a long-term plan that takes stock of where your business is and where it's going. That means assessing your strengths and weaknesses and determining what new markets to target. It also means thinking about what your competitors are doing.
- Invest for the recovery. Machinery and equipment can take months to order and install. Now is the time to get ready for an economic rebound, Homa says. Suppliers are looking for orders; they'll give you a better price and turnaround time now than they will when the economy is running at top speed. In Blanchette's case, his investment in digital printing during the 2001 downturn helped him profit during the subsequent economic boom; it also allowed him to survive when the economy went south again.
- Focus on human resources. The right employees are critical if you are trying to jump on the recovery, Homa says. As well as hiring new employees, you also need to make sure existing employees are keen. "Keep your current employees engaged. Offer them shares in the business to keep them motivated so they can participate in the upturn," he suggests.
- Improve your "bankability." Investment takes money. Start talking to your bankers now. Invite your account manager out to lunch or to tour your plant. "If the first time you call them is when you're in a tight squeeze, they will wonder why you're calling," Homa says. "On the other hand, if they understand your needs, they will respond more quickly."
- Take advantage of lower prices. With raw material prices still below their 2008 highs but bouncing back quickly, now is probably a good time to lock into long-term supply contracts. "Buy when the market is down," Homa says. "Commodity prices should go up as the economy picks up." One strategy is to commit to buying in volume; you'll get a better price now than you will if you buy when prices are rising, and you won't have to take delivery right away.
- Focus on your suppliers. It's also a good time to make sure your supply chain is diversified and to enhance relationships with suppliers. "You should always have more than one supplier. You don't want to be held hostage. If they know there is another supplier, it will keep them on their toes," Homa says. "But you also want to create loyalty among your suppliers. Ordering in volume and not having too many suppliers creates loyalty."
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