How to Sell in a Recession and When Interest Rates Are High

Phil,

Your mother told me you've been sleeping badly. That the bank raised the rate on your working-capital line, that two customers asked to push their orders to next year and that you're thinking of cutting everything that isn't rent and payroll.

Before you cut, let me tell you something I've never told properly to anyone in the family. It's about Clyde.

You may remember him. The neighbor across the street, from the uniform shop on the other side of the road. We started almost together, with the same machines, the same customers, even the same head seamstress, who worked for him before she came to me. In 2007, if someone had to bet on which of the two shops would last longer, I think they'd have bet on his. He had more contracts than I did.

By 2011, Clyde's shop no longer existed. You know mine.

It wasn't luck. And it wasn't because I worked harder. He worked as hard as I did. It was a decision each of us made in the first half of 2009, almost the same week.

The short answer, if you're in a hurry

In a downturn, the ones who sell are those who stop waiting for the customer and go get them through the cheapest and most direct channels they have: their own base of past customers, partnerships with companies that sell to the same audience and outbound prospecting. Cutting costs is necessary. But cutting acquisition channels, meaning the paths through which new customers reach you, usually turns out to be the most expensive cut later.

The rest of this letter is the why.

The week the two shops got the same phone call

You were a teenager, so you may not remember how it went. The recession didn't arrive all at once. It arrived in phone calls.

Our biggest customer at the time was a supermarket chain. In the same month, they called me and Clyde with the same news: they were going to suspend that year's uniform replacements. Maybe next year. Maybe not.

Clyde did the math and did what seemed sensible. He laid people off, held on to cash, canceled the trade show we attended every year, stopped visiting new customers because "nobody's buying anyway." His strategy was to cross the desert standing still, spending the minimum, waiting for the rain to come back.

I cut too. Don't kid yourself, Phil: I cut a lot. I cut the company car, renegotiated the rent, went without my own salary for a few months. But I made a decision that, at the time, looked crazy even to your uncle.

I didn't cut the search for customers. I increased it. I just changed the type.

What I did with almost no money

I had no budget for ads or trade shows. I had time, because the factory was empty, and I had a file of customer cards. That's what I worked with.

1. I opened the drawer of old customers. There were cards for companies that hadn't bought from us in two, three years. I called each one myself, in the afternoons. Not to sell: to ask how they were managing with uniforms. Many had switched suppliers and were unhappy. Others needed very little, but they needed it. A small order pays the electric bill too.

2. I went after people who already talked to my customer. A workplace safety training company served the same factories I wanted to serve. I made a deal with the owner: she referred me when a customer needed new uniforms after a training, and I referred her to mine. No money changed hands.

3. I changed my audience, not my product. Supermarkets stopped buying? Apartment buildings still needed doorman uniforms. Clinics still needed scrubs. Private schools still needed T-shirts. I made a list of a hundred names and visited two a day.

4. I went where buyers already gathered. The chamber of commerce held a monthly breakfast. I went to every one. I carried fabric swatches in my purse.

None of these channels required a big investment. All of them required consistency. And none made me rich in those two years. They kept me alive.

What Clyde didn't see

When the economy started to breathe, around 2011, companies went back to buying uniforms. But they went back to buying from whoever was still in front of them.

Clyde had spent almost two years without visiting anyone. His old customers had met other suppliers. The new ones didn't know he existed. When the rain came back, he had his umbrella closed, and his neighbors had buckets in hand.

He told me something the day he sold his machines that I've never forgotten: "I saved so much that there was no company left to save."

The downturn didn't choose between the two of us. It hit us both equally. What chose was what each of us did with our sales channels while it lasted.

What changes when interest rates are high

You're going through something similar, with one difference: interest rates. When credit gets expensive, two things happen at once. You think twice before borrowing money. And so does your customer, so they put off purchases, ask for longer terms and negotiate harder.

That changes which kind of channel works best. In these periods, it's worth prioritizing:

Channels that cost time, not money: referrals asked for at the right moment, calls to your customer base, partnerships, a presence in groups and associations. You don't have to finance the test.

Channels with a quick return: the old customer already trusts you, so the sale is shorter. It's the first place to look for revenue in a hard month.

Channels that bring the right customer: in a downturn, a customer who only shops on price eats your time and doesn't close. Prefer paths that bring people who already need what you sell.

And a rule I learned the hard way: don't spread the little energy that's left across ten things. Choose one channel, run it for a month with discipline, write down what came from each contact. Then add the next. If you want a step-by-step for that month of testing, read how to test a new sales channel in 30 days.

The question I wish you'd answer

You don't have to answer in writing. Just think.

If your biggest customer called tomorrow to cancel, where would the next one come from? Do you know? Or is the honest answer "I'll have to figure it out"?

If you know, you're the shop that stayed. If you need to figure it out, you still have time to stop being Clyde's. He wasn't incompetent, Phil. He just had one channel and thought he could wait.

What I wish I'd had in 2009

I found my channels the hard way, calling from card to card and getting a lot wrong. It took months to understand which ones worked for a uniform shop and which were a waste of time.

So, along with this letter, I'm leaving a recommendation. A businessman named Luiz Philipe Campos put together, in a guide, 100 customer acquisition channels, organized in 10 parts: referrals, partnerships, Google search, social media, ads, outbound prospecting, communities and events, marketplaces, local actions and press. For each channel, he explains what it is, gives a practical example, says what the first step to test it is and what that test costs, whether free, low, medium or high. In a year like this one, that last piece of information is worth gold.

It comes with a worksheet to score each channel by cost, speed and fit and choose your first three, and with a 30-day plan, day by day, to launch the first one. It's exactly what I did with the cards, only without having to guess.

Buy it before you cut the next expense.

A kiss from your aunt,

Helen

Next step

Don't depend on a single way to win customers

Everything in this article works better when new customers arrive every month. Most businesses depend on two or three channels and suffer when one of them slows down. The 100 Acquisition Channels Guide shows 100 ways to win customers, a practical example of each one and the first step to test it spending little or nothing.

• ✓The 100 channels, one by one, from the best known to the ones almost nobody uses
• ✓A practical example and a low-cost first step for each channel
• ✓A simple way to choose the channels that fit your business now
• ✓Bonus: Channel scorecard
• ✓Bonus: 30-day test plan

Get the 100 acquisition channels guide for $49

One-time payment · Instant access · 7-day guarantee

The 100 Acquisition Channels Guide costs less than a business lunch and reaches your inbox right away, as a PDF, to read on your phone or print. Payment is one-time and Hotmart guarantees 7 days: if it doesn't make sense for your business, you ask for a refund.

In a downturn, the question isn't whether you'll cut. It's what you'll keep running while you cut.

Helen, Clyde and Phil are characters created for this text.

Frequently asked questions

How do I sell more in a recession?+

Start with the cheapest and fastest channels: past customers, referrals asked for actively and partnerships with companies that serve the same audience. Then, if possible, open a new audience for the same product. The most important thing is not to stop looking for customers while you cut other costs.

Should I cut marketing during a downturn?+

Cut what doesn't bring in customers, not the search for customers. Marketing spending that only generates views can go; a channel that brings sales, even small ones, should be kept or reinforced. Companies that disappear from the market during a downturn often struggle to come back when demand returns.

How do high interest rates affect a small business's sales?+

High rates make credit more expensive for the business and for the customer, who starts postponing purchases and asking for longer terms. In these periods, channels that cost time instead of money and those that bring customers who already trust you gain strength. A customer list, referrals and partnerships are on that list.

Which acquisition channels are cheap to test?+

The 100 Acquisition Channels Guide gives the cost to test for each of its 100 channels: free, low, medium or high. Referrals, a Google Business Profile, partnerships, groups and associations, and outbound prospecting are usually among the cheapest. The bonus worksheet helps you choose the three with the best fit for your business.

Does it work for my type of business?+

Yes. The channels cover local businesses, service providers, online stores, B2B companies and professionals. The guide helps you pick the ones that fit your case.

How do I receive the guide?+

Right after payment, Hotmart sends the access to your email. You can read it on your phone, computer or print it.

What if I don't like it?+

You have a 7-day guarantee. If it isn't for you, ask for a refund through Hotmart within that period.

The 100 Acquisition Channels Guide

100 ways to win customers without depending on a single source of sales

Get the 100 acquisition channels guide for $49

One-time payment · Instant access · 7-day guarantee