Assisted Living Facilities Should Take Advantage of the Recession
The Common Reaction To An Economic Downturn
Yes, we are in a recession. And the odds of a double-dip are increasing. In such times, typical business owners, including assisted living management, batten down the hatches. They cut spending, consolidate responsibilities, and attempt to weather the storm.
As monthly financial statements and census reports come in, owners stress out. Compared to last year, things look grim. Margins are down, sales are down, and morale is down. Does this sound familiar?
Could There Possibly Be Any Good News In A Down Economy?
The recession has a bright side. It comes from the fact that your competition is facing the same situation. They are most likely reacting to the recession in the typical fashion mentioned in the first paragraph. So, if everyone is using the same strategy based on spend less and do less, who has the strategic advantage? It could be you.
I suggest a change in perspective. Take advantage of what the recession has to offer:
- Increase in market share. This takes precedent over profits. While competition scales back, you should be aggressive in marketing and communications, as well as maintaining and even adding services.
- Refine operations. The big cutback during a recession should be the cutback in the waste of time, talent and systems. Efficiency can allow you to do what is necessary to increase market share while containing costs.
The Strategy Is Proactive
Especially in a down economy, it is critical to make each dollar spent responsible for a result. When an employee is given a job, they are held accountable to complete the task. Treat your dollars the same way. Employ your marketing expenditures to produce revenue, improve productivity, and/or increase customer loyalty. And make them report their results – utilize tracking.
By holding dollars accountable, unnecessary expenses are automatically cut. At the same time, dollars spent that attain desired results may be increased. This prevents the numbers oriented, “across-the-board” expense cuts that stifle productivity and devastate morale. And it encourages investment and growth in areas that prove successful.
Market aggressively and apply the responsible dollar strategy to your marketing plan. By tying revenues to marketing costs, expenses become responsible for results. By testing campaigns and coding responses, inefficient marketing expenditures can be stopped. On the other side of the coin, marketing expenditures that increase customer base, utilize key employees, and/or boost profit are continued, or may even be increased.
Service, service, service your customer. Add improvements, even when your service leads the competition by a mile. This makes sure the customer continues to feel special and drives word-of-mouth marketing. The least little extra is a big deal to your customer because services are being cut everywhere else. These extras can have little or no cost.
Remember: Superior service is an attitude.
Service improvements give you leverage in the market when all other variables (price, quality, features) are equal. Also, with an increase in business failures eminent during a recession, this leverage turns into increased market share. In fact, I recommend that you have a plan in place to be the hero if you hear that a competitor is closing. (Be prepared to buy a portion of the distressed business – appropriate residents who choose to move to your facility along with the best employees. In many instances you can pay over time with the new revenue, keep residents with staff members they know and love, and save some jobs.)
This Opportunity Is There For Those Who Want It
Does all this sound easy? No. The strategy is simple. But it takes hard work planning, discipline, teamwork, trust, the ability to change, and patience. Can this be managed during these difficult times?
Now is the perfect time! The pain of the recession is the ally of opportunity. It creates the leverage you need to institute and sustain changes in operations. It unites management and staff to fight for the good of the company. And it offers chunks of market share to those planning to grow out of the recession.
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