Strategies to prevent economic recessions from causing business failure

John A. Pearce, Steven C. Michael

Research output: Contribution to journalArticlepeer-review

Abstract

An average of more than 500,000 businesses failed in the United States during each of the 10 recessions that have occurred since the end of World War II. Yet, scholar and practitioner understanding of how to prepare for and respond to the challenges of an economic downturn remains extremely limited. This article analyzes and synthesizes the information from academic theory and business experience on managing through an economic recession. To assist firms in successfully navigating economic recessions, we suggest a program that involves positioning by investing in multiple markets and geographies, planning by developing a turnaround plan for facing sharply declining sales, promoting by maintaining marketing initiatives, and preparing by acting in anticipation of economic recovery.

Original languageEnglish (US)
Pages (from-to)201-209
Number of pages9
JournalBusiness Horizons
Volume49
Issue number3
DOIs
StatePublished - May 2006

Keywords

  • Business failure
  • Economic recession
  • Macro economy
  • Strategies

ASJC Scopus subject areas

  • Business and International Management
  • Marketing

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