When the economic landscape is uncertain, you can’t afford to sit dead in the water.

Companies around the world are reevaluating how they do business in order to overcome the storm that we all face in this moment. In times of economic uncertainty, companies need to be agile to manage change and protect—even grow—their business despite challenges.

In a down economy, it’s important to adjust your strategy based on financial models that consider a variety of scenarios so your strategic approach can be data driven and account for both knowns and unknowns.

Be Proactive With Your P&L
No business leader wants their business to contract during an economic downturn. But, sometimes it’s unavoidable if the market is experiencing contraction or turbulence. During these times, take a long, hard look at your company’s profit and loss.

Analyze your expenditures to determine exactly which ones are necessary to keep your business operating and making a profit. You will probably have to make some tough choices, especially when it comes to your crew and the perks you offer during times of prosperity. If you are spending money on something that doesn’t move the ship along or can be achieved at a lower cost to the business, you need to make an immediate course correction.

Develop projections for the performance of your business based on numerous scenarios. Create financial models for best- and worst-case scenarios, as well as something in between.

It’s wise in times of economic uncertainty to take a conservative approach and aim to combat the worst outcome. If the actual outcome is better than you planned for, at least you were prepared. You can always readjust your strategic approach.

If you had plans for expansion over the coming months and the market won’t accommodate those plans in the near to midterm, then determine the most viable and realistic course of action given the new economic outlook.

Reevaluate Your Market
If you have to temporarily suspend your plans for growth, then you probably need to reevaluate the markets in which you operate.

If you’re a lender who finances projects across the country, watch the housing market closely to determine which geographies will likely be the strongest over the next year or so. If you find a significant disparity between the outlook for your target geographic markets, consider shifting your focus and resources toward the markets that present the best opportunity even during an economic downturn.

There are many metrics you can use to evaluate any given real estate market. Determine which ones make the most sense for your business. Looking at trends both before and following the onset of an economic downturn, consider population and job growth and the change in the absorption rate, among any number of other factors. Commit the majority of your time and resources to the markets you determine provide the greatest level of opportunity for your business.

Adjust Your Offering
The way you structure your business and the services or products has probably evolved over time to accommodate the market and your target audiences. But during an economic downturn, both the market and, in all likelihood, your target audiences have changed dramatically. This is where it pays to be proactive. If you’re simply reacting to the market winds, you’ll struggle to fill your sails.

Conduct a thorough analysis of what you are offering and determine whether it will continue to be attractive or to provide the same level of value to your potential clients in the current economic climate as well as the midterm. For example, how are the economic challenges likely to impact interest rates? How do you compare with what your competitors are doing to counteract market conditions?

Given the constraints lenders face during times of economic hardship, it might be necessary to adjust your interest rates or your general terms to attract new business and to make sure your current loans are successful. Remember, your borrowers are facing the same challenges. Without offering them a little flexibility, they may not be able to get projects across the finish line.

Get Creative With Capital
A declining economy creates hardships at every level of the financial industry. Many capital providers in the private lending industry have taken a “wait-and-see” approach,

freezing activity in the sector until the uncertainty becomes a little less…well…uncertain. If you find that your regular capital sources have dried up, what do you do?

One thing we learned during the last recession is how to be resourceful. Reach out to your network and external partners to leverage any resources you may have outside of the company. Many lenders might rely on only a handful of capital providers to operate their business. If those capital sources pull back, you have to find new ones. Consider a more “boots on the ground” approach if necessary.

If your company utilized only a few larger capital providers in the past, now could be the time to cast a wider net. Though it takes more legwork, you might need to get creative by building a network of smaller investors. Each individual investor will likely have different goals, motives and risk tolerances. Although it will take more investors to fulfill your capital requirements, you will have a wider audience to appeal to. Don’t limit yourself to what you’ve always done. Times like these require some creative thinking.

Communicate, Communicate, Communicate
Communicating with team members, clients and external partners is paramount. And, there’s no reason you can’t continue—even improve—your communication despite challenging circumstances. In fact, it’s absolutely crucial to do so. Take advantage of the technology at your disposal to stay in front of your clients. Use every option available to you, including phone calls, video conferencing, emails and even text messages when appropriate.

Be sure you and your teams have access to those tools and can use them proficiently. There is no such thing as overcommunication, only a lack of. Work with your team and your business leadership to develop the appropriate communication plan for your business.

Persist
No single approach is a panacea. You and your team members will know better than anyone what will work best for your business. But when the economic landscape is uncertain, you can’t afford to sit dead in the water. By tightening your belt, reevaluating your market and offering, finding new ways to haul in capital, and expanding your communications efforts, you can do more than just stay the course—you can sail!