Skip to main content

How to Test a Business with 8 Key Success Areas
Business Cycles Happen.

The automotive and heavy-duty truck industries are certainly not exceptions to this rule. Don’t get caught off guard by adverse economic circumstances.

Pay attention to these key factors to determine how well your business can tolerate an economic or market downturn:

1. Balance Sheet

Is your business highly leveraged? Are your inventory levels out of alignment? If so, take the necessary steps to align your inventory with customer demand.

2. Business Intelligence

Are you plugged into your market conditions, competitive trends, economic indicators, and other vital business intelligence? Be sure to keep up with industry news. Attend a trade shows, or consider joining an industry group.

3. Stakeholder Outreach

Talk to your customers and your suppliers to get a pulse from others in a similar position. Engage your bank for insight into your business’ ability to weather economic storms and guidance in strengthening its resilience.

4. Cost Structure

Do you have cost-reduction plans on the shelf ready to deploy in case sales volume starts to decline? If so, does this plan allow you to continue executing your strategic plan? Anticipate your business cycle, and respond quickly by managing headcount and discretionary costs.

5. Optimize Operations

Focus heavily on operational excellence before a downturn to drive process efficiency and throughput. Re-deploy assets that can help you sustain your competitive advantage.

6. Marketing

Never stop marketing your company. Downturns are the best time to gain market share at a lower cost of client acquisition. Diversify your sales before, during, and after a downturn.

7. People

Make sure you’re properly valuing your company’s human resources. Are your people with you for the long haul? Take great care of your best and brightest. Reward high performers, and instill loyalty through long-term incentive plans.

8. Cash Position

Maintaining a strong cash position will enable you to take advantage of bargain acquisitions during a downturn. Also, consider accounts receivable insurance well in advance to protect this critical current asset in the event your customers are unable to pay.

Operational Excellence with CCO

If you are an automotive or heavy-duty truck supplier and want to get out in front of reduced OEM sales volume, please contact Cornerstone Consulting Organization. Our differentiated operational excellence model and intense focus on execution helps our clients get ahead of downturns. We can help you build a resilient business model, establish long-term sustainability, and enjoy peace of mind that you will not just survive but thrive a during downturn.

Email us at 888.324.4808 or to set up a free consultation. For more information about why to choose Cornerstone Consulting, click the link below.


CCO cannot and does not provide legal advice. It’s important to consult with qualified counsel before adopting any new policies. It’s also your responsibility to determine whether legal review of work product is necessary prior to implementation.