Responding to the challenge.

So what can you do when business slows down?

I see four options. (A fifth option of adjusting your spending levels to your revenue, goes without saying.)

1.) Increase your promotional efforts. This option I think is the least effective. I don't think advertising for Pegasus Books works in the best of times, and works even less in the worst of times. Except, perhaps, when you do option:

2.) Decrease prices. Have a major "Sale!" Give product away, and advertise the fact. Thing is, while this may help you raise funds in the short run, it effectively damages your inventory in the long run. Except when you sell product that you got at discount yourself, and which you have no intention of replacing it. Which you can only do when you do option:

3.) Buy more product. This is my preferred option; get more stuff. Back during previous slowdowns, I'd try to get product from my suppliers and try to get better payment terms. I'd try to get longer periods to pay, for instance. But having lots of product to sell, and having the option to offer customers a discount (in most cases, in a one on one situation) seems to work.

4.) More service. I mean, much more service and knowledge, because if you've been a viable business for any length of time, you are already probably above and beyond the call of duty.
Often, this ties into #1, above, the promotions. Free space, free time, free events, etc. etc.
After 30 years, this is my least favorite option. I fear burnout more than less sales.

I tend to do mostly Option 3.) Buy more product. Unlike the old days, I'm being offered deals all the time, and my strategy is to be as opportunistic as possible, all the time, not just when it's slow. If I can get something at half the normal price, I can sell half as much or take twice as long to sell it. So I do everything I can to keep the store well-stocked, which in the long run the customer can feel and will respond to.

I'm trying to stretch every buying dollar, leverage my budget to the maximum. Of course, if you give away too many discounts, you lose the advantage. Still, I will also do Option 2, Decrease prices. But only on product I get a deal on, and only when I have to, and only if I don't replace it. I tend to offer these deals on a one to one basis, because I know whether I can do it, and whether I need to do it.

Selling off perennial product, (best-sellers, must have in stock) , just to raise capital, is a muggs game, obviously. It takes 4 or 5 turnovers to both make the original margin and keep the product in stock -- and that's when you get the 40%. If you sell it cheaper, it takes much longer.

So far, I've managed to get good product replaced, and bring in a constant flow of new product, and still get everything else done. So, I'm feeling like a management success.