Exploiting niche markets and developing innovate ways of packaging and rebranding existing products could be two ways to survive and thrive during a potential W-shaped recession.

That's the view of businessman Stuart Williams, director at independent insurance broker and business continuity specialist Cowens Survival Capability, and Darren Shirlaw, of business consultancy Shirlaws.

Stuart believes that, based on analysis of previous economic cycles, the economy is heading for a W-shaped recession and he has developed some tips for businesses to survive.

Stuart said: "During a boom time, businesses tend to focus on strategy - acquisitions, recruitment and new products - and forget the micro aspects such as cost management, efficiency and processes. Going into a recession, people switch from the macro to the micro and worry about costs and staff, while forgetting strategy.

"During a recession, the smart businesses concentrate on strategy - and watch out for the micro - right across the economic cycle.

"The world is likely to panic at the next market dip, thus creating big opportunities for the business owner who is confident and secure of how their business sits in the economic cycle and is preparing for the next boom."

Stuart says that coming out of this recession, there are two ways of creating innovation - looking for niche opportunities and stepping up consolidation.

He commented: "Preparation over the next 12 to18 months is critical in maximizing the benefits from the next boom. Businesses need to get their numbers right and take the time to focus on the ratios, prepare and plan.

"They need to ask themselves what is the maximum revenue their organisation can generate and how many people are needed to maximise profit. Getting the timing right is crucial, and it's a wise idea to match business development stages to the economic phases."

And he added: "In terms of packaging and distribution into niche markets, you may not need to innovate new products, but you probably do need to package these lines differently. Freshen up the brand and then take the products into defined niche markets having identified customers that want your products."

Darren Shirlaw, of Shirlaws Corporate Coaching, says that the past 100 years have seen three other periods when markets have fallen by more than 50 per cent -1929-1932, 1937-1938, 1974/5 - and that a W-shaped recovery has also followed such deep recessions.

Darren said: "Markets tend to move six months ahead of the economy and if we trace the trend lines backwards, July 2007 was the turning point, being when the markets started to crash. In GDP terms we didn't see the recession until six months later in 2008 when it also started to show in the economy.

"Because the economy always follows the markets, when the markets jumped from March to September 2009, it was likely the economy would jump from September 2009 to March 2010. It did and the general prediction was a return to recovery.

"So that brings us to today, recovery hasn't followed because we are in a W recovery, finding us in a flat period before the next boom. Timing in business is critical, but getting there in good shape is vitally important too. In a W recovery, towards the end of this flat phase we may see a short dip for about six months after which the markets will turn around and recover. Pretty much like the previous March - September dip before going back up again."

And Darren warns that the flat phase could last anywhere between two and 10 years.

He concludes: "When people see a flat market, they often believe they can't do anything about it and their business also goes into a flat mode. But when the market is flat, it's just an average of business performance. In reality, some are doing well and growing, some are flat and some are in decline."