Episode 234: How To Handle A Recession In Your Wedding Business

There is a lot of talk about an impending recession in 2023. No one can predict the future but I have some hot takes about whether you should be concerned about a recession, what the current reality is despite what news reports might say, and of course some specific actions you can take to prepare your business for a recession.

Recessions happen about every 10 years in capitalist economies. It’s an unfortunate inevitability of how our economic system works. It’s not great, but it’s the system we have. But that doesn’t mean you should live in fear and it doesn’t even mean that your business will take a hit.

In this episode, I share my thoughts about the worry and concern about a potential recession, what you should definitely not do if you’re worried about a recession, and 6 steps you can take to prepare your business for an economic downturn.

In this episode we’ll cover:

• What a recession is
• Are we heading into a recession?
• How to think about recessions
• The truth about recessions and business
• The good news about luxury industries
• What economic data tell us about consumer spending
• Why worrying about a recession makes it worse
• The importance of your mindset
• How panic fuels recessions
• How people make tons of money during recessions
• What you definitely shouldn’t do to prepare for a recession
• 6 simple steps you can take to prepare your business for a recession
• What to avoid to maintain a healthy mindset

How To Handle A Recession In Your Wedding Business

What is a recession?

The definition of a recession is debatable among economists. A recession is a significant, widespread, and prolonged downturn in economic activity. A common rule of thumb is that two consecutive quarters of negative gross domestic product (GDP) growth mean recession. Usually, inflation is high as is the unemployment rate but again, there’s no one definition.

We are currently not in a recession if you go by the 2 consecutive quarters and the unemployment rate. There’s debate around if it’s actually going to happen.

Recessions are unfortunately normal in capitalism so one will happen sooner or later. Recessions are the inevitable result of the business cycle in a capitalist economy and they happen about every decade. It’s definitely not a great system but it’s the one we’re stuck with for now.

We live on this roller coaster so we shouldn’t be shocked by it. We’re really only shocked when the media fans the flames and never shuts up about it and that’s what’s happening now.

What is actually happening?

If you only get your news from nightly news or 24-hour news networks, you may think a recession is coming any day now and it’s bound to hit the wedding industry hard. That’s a narrow view that ignores some really important data.

We are a luxury industry BUT the new richest person in the world is the CEO of LVMH. LVMH is a conglomerate of more than 70 luxury consumer goods companies including Tiffany & Co., Christian Dior, Sephora, Louis Vuitton, Hennessey, and Fenty. The CEO of LVMH is the new richest person because global luxury goods sales were up a whopping 22% to 353 billion euros in 2022 compared to 2021

Yes, 2022 has been bad for inflation. Yes, eggs are stupidly expensive right now. And YET Black Friday sales still set records topping $9 BILLION in sales.

You still spent money during the pandemic and the financial crisis in 2008 and those are extremes. You’re in a luxury industry and many of your clients are recession-proof. Most recessions don’t hit as hard as the pandemic and many of them don’t impact consumers all that much.

What not to do

Whatever you do, do not under any circumstances cut off your lead sources because of an ” impending recession”. If you’re paying for advertising or marketing that is bringing you clients, that is not the place to cut back. Doing so will only result in fewer leads, fewer bookings, and lower revenue.

I understand that the panic in the messaging around a potential recession has serious head-for-the-hills vibes but don’t cut off your nose to spite your face here.

How to handle a recession in your wedding business

Now that we’ve covered what not to do, there are 6 specific things you can do to prepare for and handle a recession. Remember, recessions are inevitable in our current economic system so there will be one sooner or later and that’s okay. These things will keep your business healthy and growing.

1. Offer more payment plans

Maroo was the first to offer Book Now, Pay Later for weddings and it’s really something everyone should be using for payment plans. 74% of couples turn to high-interest credit cards to help pay for their weddings and that can cause them to hold off if they feel uncomfortable about a coming recession. Maroo provides an option for couples to pay for their wedding for up to 12 months at 0% APR.

Meanwhile, you get the full, upfront payment the moment the couple books BNPL for their wedding so you don’t have to wait for or chase the payments. Maroo also makes your clients feel more secure by offering wedding cancellation insurance. This pre-empts the concerns and worries your clients may have and make them feel more comfortable with pulling the trigger and booking you.

You can sign up for your free Maroo account and start offering Book Now, Pay Later here

2. Create smaller offers

Links & Resources:

Get your free ticket to Wedding Business CEO Summit
The Wedding Business Collective
Episode 228: Behind The Wedding Business with Kay Northrup of Kay Northrup Events
Episode 167: Diversifying Your Wedding Business Revenue Streams

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