When it comes to business lessons, 2008 provided a bumper crop.
The economy was dismal. Month after month, companies cut back, laid off workers or completely imploded. For the most part, it was an equal-opportunity malaise, affecting businesses of every size and in every industry.
But hidden among the doom-and-gloom headlines were some inspirational stories, too. Despite the tough times, companies found ways to increase sales, reinvigorate their brands or save on expenses to boost the bottom line. Here are the top survival strategies that helped large corporations weather tough times. Could they boost your business, too?
1. It's all about the customer:
Barnes & Noble
. When it comes to consumer goods, there are plenty of national rivalries fighting for the same dollars.
This year, two major retail chains faltered in the face of their better-prepared competition.
Linens 'n Things
went out of business, leaving
Bed Bath & Beyond
the only major national player in housewares. Electronics chain
filed for bankruptcy protection and closed numerous stores. Its main rival,
, has done far better weathering the slowdown in consumer spending.
What did Bed Bath & Beyond and Best Buy do right? (And, no, the answer doesn't have anything to do with the letter "B"). Both focused relentlessly on what customers wanted and made sure they got it.
Linens 'n Things may have stocked more fashion-forward items, but Bed Bath & Beyond attracted a wider customer base by focusing on basics. More importantly, it had a better inventory system, so shoppers could find what they needed. Similarly, Best Buy studied its customers' needs and habits and trained its employees accordingly.
In short, both chains created a more satisfying shopping experience. Sounds simple, right? But think about the steps involved: You have to predict what products will be in demand, make sure they're available at the right time and train employees to be helpful but not pushy. Getting all those gears working together smoothly isn't easy, but it's a winning strategy.
2. Creative cost-cutting pays off:
Sometimes there's no way around it. With rising commodity prices, you have to pass on the increases to stay profitable. But will already cash-strapped customers keep buying?
Take a lesson from companies such as
. The food-products giant has shed unprofitable brands and reinvented items to make them both healthier and cheaper to produce. A case in point? The company's very successful line of 100-calorie packs of crackers and cookies, which sell well because they're health-conscious, but also cost less to produce because they're so much lighter than traditional snacks.
Other food companies have gotten creative with packaging, too. As the cost of milk and other dairy prices rose, ice-cream manufacturers began selling 1.5-quart containers, rather than the traditional half-gallon size, at the same price.
began selling milk in square-shaped containers that save on transport costs because they can be packed more efficiently on trucks.
Ideally, such cost-cutting is a win-win situation. Your products become more healthy or environmentally friendly, while your costs go down.
3. Expand your mission:
The humble neighborhood drugstore might not seem like a hotbed of economic creativity. But
both maintained steady sales this year (no easy feat in itself), while experimenting successfully with new sources of revenue. Both chains now offer retail clinics: in-store offices where nurses or physicians' assistants diagnose and treat common, non-emergency illnesses. If you need a prescription filled, the pharmacy counter is a few steps away.
The drugstore chains have also been expanding their selection of food (a major growth category), while Walgreens is testing a café concept aimed at stealing business away from
You can't be everything to everyone, but logical outgrowths of your core business can pay off big.
4. Tell a good story:
This isn't the best time to be in the luxury-goods business. After all, iconic brands from
Tiffany & Co.
saw sales drop this fall. So how did
wind up with a 26% increase in net income over the past six months, compared to the same period last year? Increased international sales, probably due in part to the boost the company got from outfitting the U.S. Olympic Team.
But the long-term secret to Ralph Lauren's success is its story and image, which it sells as much as clothing and accessories. People around the world associate the brand with a particular lifestyle, and it's one they want to be a part of.
Does your brand have a strong image? A story that resonates? If not, use these slow days at the end of the year to brainstorm. You'll have to be ready to sell yourself all over again in 2009.
Elizabeth Blackwell is a freelance writer based in Chicago. She is the author of Frommer's Chicago guidebook, and writes for the Wall Street Journal, Chicago, and other national magazines.