1. Encourage Revenue Growth
To survive in difficult economic times, you need to think about your income. Consumers will reduce their spending on necessities of life, which will undoubtedly impact gross revenue. Your product or service might be “nice to own” but not essential or necessary for average consumers. Learn as much as you can about Marketing and Selling. This is not the time to reduce your marketing, advertising, or sales budget. You should be more selective about how your marketing dollars are spent. Changes in marketing practices won’t bring you revenue overnight. Be persistent. A single advertisement in the local newspaper will not result in a large number of enquiries or sales. A well-balanced marketing campaign takes time. Don’t discount the value you provide with your product or service. At the price that makes you profit, emphasize the value you offer to your customers.
2. Look after Current Customers
Your customers deserve your full attention. This is the right time to build a stronger relationship with your customers. You don’t have to understand their motivations or concerns. They don’t need to be concerned about your business’ problems. Do not try to convince customers that they should buy your product or service. Listen to what your customers need and then offer your products or services to meet those needs. Keep in touch with your customers. Ring them often to hear their opinions on the market.
3. Suppliers are also real people
Your supply chain is not only the supplier that deals on a C2C basis but also the B2B relationships. As clients defer payments, your supplier will experience cash flow problems and will be pressed by his B2B suppliers for payment. Ask your suppliers for advice as they deal with customers. Be mindful of your time. You can outsource services at a lower rate than the hourly rate out, so you should consider outsourcing.
4. Financial Control/Cash Flow
Concentrate on the key profit/cash flow drivers such as:
(a) Cost of Goods/Services sold
- You can control your direct labour and material.
- Negotiate with suppliers to get better terms or prices
- Improve job management or process.
(b) Margin
- It is crucial to understand the margins of your products/services.
- Selling goods or services with a higher margin will result in greater profits.
(c) Overheads
- Concentrate on the most expensive items to make the most of any savings.
- Examine telecommunications because there are many good deals available and logistic cost savings that can be made by being more efficient than other providers.
(d) Receivables
- Communication of payment terms is required.
- You will need to conduct a credit check.
- It is crucial to collect debt effectively
(e) Inventory/Work In Progress
- Keep an eye on sales and stock levels, and be aware of slow-moving stock. Get rid of any stock that is no longer needed.
- Monitor, manage and accelerate work progress.
5. Networking
Do not dwell on your problems when there are other options. You may find your problems less than others and you might be able offer practical solutions. You may find solutions to your problems or doubts that they have experienced. People who have gone through difficult economic times in the past can offer valuable business advice. Make use of their experience.
It is a good idea to make it a habit of attending networking events every week. It is important to keep in touch with the market. The only way to do this is to talk to other businesspeople.
6. Smarter Smarts
It’s true, you should educate yourself. Smarter businesses will grow and prosper more than their competition who rely on luck or outdated business practices. Reexamine your business strategy and operational management and include your planning and execution in a Business Plan. A mere 50% of small businesses do not have a current business plan. This is a recipe for disaster, and a Plan to FAIL. What if you could plan your holiday without a map? Spend time with business friends and associates to plan your business. You can also brainstorm ideas for your business growth.
7. Personal
Many companies will retrench employees, lay off workers or not hire new staff to replace their existing workforce. It is time to evaluate the productivity, efficiency, and performance of your workforce. You don’t need inefficient people to guide you through difficult times.
8. Proces
You should take stock of your business processes. If you have processes in place for all of your operations and systems, your organisation will be more efficient and cost-effective. All processes should be examined, from the simple task of answering the phones to complex production lines. All processes should be written down and made available to everyone. Most importantly, be a leader by following your own process. Talk the talk, walk the walk.
9. What if I can’t go without?
We have all made the decision in the past that the LCD TV is essential, the car is necessary, and the pool is important. Now is the time for us to ask ourselves the question: Do I really need it or can I live without it? This is the same question you should ask about your business practices. It may be nice to have a private seat at the footy, but is that a business necessity?
10. Attitude
You can play with your business colleagues to compare how difficult times are and what the latest business failure is. This is a way to perpetuate the current state of affairs. Although it seems like business confidence is dependent on mass thinking, in reality it boils down to individualism. Tell people about the positive things that happen in your business every day. Do not allow yourself to doubt your abilities or confide in others. Positive attitudes are important for everyone, including your family. Negativity towards your family and friends only leads to more anxiety. Positive attitudes will help your family and friends adapt to adverse situations. The same applies to your business colleagues.
Bonus Tip
Online Businesses
- Even for web developers and web-based businesses, it’s not all bad news. It takes only a shift in your focus to make your business more successful.
- Online sales often offer a significant pricing advantage, allowing you to sell at a lower price. This is what most people are looking for. Online businesses don’t have large overheads like rent or travel costs. Your fixed costs are lower than those that have high rents and staff travel costs. You can use this price advantage to adjust your pricing to suit the market. You could bundle your pricing to include multiple sales items or add a lower priced item to the value package, without incurring a lot of expense.
- Boost your marketing efforts: Businesses tend to reduce their costs when the economy is in trouble. Do not do this. Now is the right time to be noticed. It should be easy and cost-effective, with less competition. Learn everything you can online about web marketing and e-mail marketing. Compare competitor websites to see how they do it.
- Your marketing focus should change. People are looking for bargains. So bundle your offers, giveaways and other items that appeal to them. Keep in mind, however, that the lower your profit margin, the more you will make.