Strate­gies to stay afloat dur­ing times of a slow­down in trade

Bray People - - COMMENT -

Q. Like most busi­nesses th­ese days, my com­pany is feel­ing the ef­fects of a slow-down in trade and re­duced in­come. I’m look­ing for ad­vice on strate­gies I can im­ple­ment to get me through th­ese dif­fi­cult times. Can you help?

A. Run­ning a small busi­ness isn’t easy at the best of times, but is even more chal­leng­ing at present. Ris­ing costs, re­duced cus­tomer num­bers and dif­fi­cul­ties ob­tain­ing credit can all com­bine to cre­ate dif­fi­cult trad­ing con­di­tions. How­ever, there are cer­tain steps you can take to get you through the tough times and se­cure your busi­ness against the ef­fects of the re­ces­sion.

Firstly, you need to es­tab­lish your cur­rent po­si­tion. Per­form a SWOT anal­y­sis of your busi­ness and ex­am­ine the strengths, weak­nesses, op­por­tu­ni­ties and threats that you face. Look at the strate­gic vi­sion for your en­ter­prise. Where would you like the busi­ness to go? What are the key op­por­tu­ni­ties for you at the moment? Bear in mind that th­ese may have changed sig­nif­i­cantly over the last cou­ple of years.

Now is the time to ex­am­ine the fun­da­men­tals of your busi­ness. Have you a solid record-keep­ing sys­tem in place? Do you pre­pare man­age­ment ac­counts and cash flow fore­casts on a reg­u­lar ba­sis? You should be able to make a good es­ti­mate of the fi­nan­cial po­si­tion of your busi­ness at any given time. That way you can ad­just your busi­ness plan to meet chang­ing mar­ket con­di­tions.

Make sure you’re on good terms with your cred­i­tors and do your ut­most not to fall be­hind with pay­ments. If you do run into prob­lems, but have a good track record of re­li­a­bil­ity, your sup­pli­ers will be much more likely to rene­go­ti­ate credit agree­ments if nec­es­sary. At the same time, you need to watch spend­ing in the busi­ness. In­stead of re­duc­ing costs across the board, spend only on those items that will add most value to your busi­ness. You also need to keep a close eye on your debtors. Keep on top of any out­stand­ing amounts and don’t wait to fol­low up on late pay­ments. Be firm, but con­sider the pos­si­bil­ity of ne­go­ti­at­ing if you think it will be ben­e­fi­cial.

It’s tempt­ing to cut your costs by re­duc­ing your mar­ket­ing and ad­ver­tis­ing bud­get, but you should look for cost­ef­fec­tive ways to keep your busi­ness in the minds of poten- tial cus­tomers. Do you al­ways carry busi­ness cards with you and hand them out when you can? Have you con­sid­ered be­com­ing a mem­ber of a lo­cal net­work­ing group or cross-pro­mo­tions with other busi­nesses pro­vid­ing com­ple­men­tary ser­vices?

As a small busi­ness you have an ad­van­tage in that you’re closer to your cus­tomers. Make sure you really lis­ten to their opin­ions and what they want from your prod­ucts. So­cial me­dia net­works like Face­book, Pin­ter­est and Twit­ter are ex­cel­lent low-cost chan­nels for mar­ket­ing and ob­tain­ing cus­tomer feed­back. En­sure you’re look­ing af­ter your ex­ist­ing cus­tomers as well. Con­cen­trat­ing on ex­cel­lent cus­tomer ser­vice and al­ways go­ing the ex­tra mile will keep you ahead of your com­peti­tors.

An eco­nomic down­turn doesn’t have to mean dis­as­ter for your busi­ness. Look at it as an op­por­tu­nity to really get to know your busi­ness and de­velop good fi­nan­cial prac­tices that will help you through th­ese test­ing times and pro­vide a strong foun­da­tion for a pros­per­ous fu­ture.

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