How to take advantage of a down market as a project manager
It’s official—the United States now finds itself in the deepest recession in American history thanks to the coronavirus pandemic. With the economy shrinking by 33% in the second quarter alone, you may be fearing that your project could be cancelled soon or worse, that your job could be on the line.
In a situation as grave as this, it’s easy to focus on the negative. However, there are plenty of silver linings to be found in a down market that aren’t possible in a competitive market— especially as a project manager. Here are three ways to make a down market work in your favor:
Get the A-Team
When the market is hot, getting the best people out there to be on your team is challenging and expensive, with benchmarks being much higher and bidding wars being commonplace. In a down market, however, you have a lot of great people on projects that got cancelled who are now out of work. They’re great employees—they just got the short end of the stick.
If you’re a project manager or leader, it’s a good time to ask yourself, “Do I have the best people here?” If the answer is no, it’s smart to start assembling your A-team with the larger pool of talent now available. When you have the fortune of being on a project that’s still going strong in a down market, it’s likely that cost reductions will require you to perform at a higher level with the same number of people or less. Make sure your team is great.
Renegotiate contracts
In a hot market, suppliers increase prices because they can—it’s a competitive market. They’re not going to lower their prices unless there’s a push to do so. Down markets are an opportunity to reassess all the expensive contracts you have and ask, “Can this be lowered? Are we in a position for this to be lowered?”
Some companies have made great deals in down markets and capitalized on those opportunities. For example, a significant expense for Apple is its lease on retail stores, so the company is taking the market opportunity to renegotiate rates. As a project manager, it’s your responsibility to know the value of your resources, how they fluctuate in price and how to maximize them for the health and success of your project.
Ask for better customer service
In a competitive market, your suppliers are providing resources to a number of companies in your industry and have no need to go beyond what’s required in a contract.
In a down market, however, you may be the only client left and now have more leverage to get a higher level of service from your supplier. Without you providing them business, they’re not making any money and thus, will do extra to save the relationship.
If there’s something additional you’d like from your supplier, a down market is the perfect time to ask.
Is your industry currently in a down market? What are the other overlooked benefits of a down market? Comment below or tweet @theomarproject on Twitter.