So the Summer is reaching its end here in the Northern Hemisphere bit is the recession also Ending, and if it is can you now relax and look forward to an easier time?
There are many early indicators now that the prolonged period of recession is perhaps easing and the UK economy is looking more positive. This is NOT the time to be taking your eye of that ‘Business Ball’, for getting carried away or loosening the purse strings without thought, or letting out a sigh of relief.
What was good business practice during a recession remains, for the most part good business practice in ‘normal’ trading times.
So here are seven, yes 7, ways to ‘recession proof’ your business that will also deliver benefit at other times as well.
Customers' & Clients’ - In hard times people cut back on their discretionary spend, we have been in such a period for so long this has, for many, now become an ingrained way of life, as against a short term, needs driven, change. Individuals and businesses will remain focussed on ‘essentials’ – taking fewer, but perhaps some, holidays, deferring major purchases and shortening ‘shopping’ lists, remaining reluctant to borrow to spend.
Small businesses remain more agile on their feet, in both good times and bad; better able to speedily focus any offer around their customers' ‘survival’ needs. Continue to identify what your customer needs from you that makes them feel more comfortable, delivers greater certainty and works towards a more secure future; for many it will still be about surviving rather than thriving. Hone your goods/services offer and your marketing messages and target these buttons.
Customer Service – An often-overlooked business opportunity is customer retention; as many businesses prioritise chasing down new clients. In a struggling economy securing new customers may be even more difficult, so creating loyalty among your existing clients will always bring benefit regardless of the economic climate. Customers seek, and even expect, more for their money, looking for the added value as well as the spotting the ‘best’ price. Every step of your customer service process, from taking the order to delivering the good or services, should be client focussed. Consider collaborative offers with complimentary businesses, delivery that is faster or suits the clients’ availability, flexible payment terms to add that sought over extra value.
Keep Calm and Carry On Marketing - Many business owners make the mistake of cutting back their marketing activity and spend in periods of economic slowdown. Those that instead, make their marketing more intense than ever will be better placed as a downturn swings upwards. Contact old/existing clients with offers and incentives that add value; use the muscle of your Unique Selling Point (USP) to it’s maximum; make sure you are able to monitor your spend and the return it brings by using bespoke offers in only one place, check you know where your target audience will be listening before you start to spend and finally leverage those low resource opportunities such as Social Media, PR through Sponsorships and arranging charity fund arising events.
Running Costs – Although you may be thinking the situation is improving, I’ve got this far, I can relax and keep going as I am NOW is the time to give revisit those overheads, look around for alternative quotes from comparable suppliers and see what else could be squeezed out of the budget. Make sure your Networking is delivering opportunity, not just a talking shop, or being done out of loyalty/habit etc. There is always potential to drive down a cost by reducing waste, be it by saving on time, material or energy, or just reducing waste to landfill costs. Being more efficient means you will be stronger in the early stages of an economic recovery and see a greater positive impact fro increased trading – be careful customer service and marketing do not suffer though!
Technology – Short and simple here - invest. Keeping ahead of your competition by keeping up to speed with changes in technology and how these can benefit your business. Using something like Customer Relationship Management software, or email marketing, can boost your reach, however be careful to maintain relationships through direct contact – nobody likes to think they are just a number, we all like to feel valued. Effectively deployed technology helps you to run your business more efficiently and thus more cost effectively, delivering access to a growing client base at the same time.
Tax Efficiency – With many accountants now offering fixed fee solutions a little work here is well within reach of most business and will bring benefits whatever the wider economy is doing. It could achieve financial savings without cutbacks. Check that you are taking every advantage of the available tax allowances; for example around purchasing equipment, improving your premises and doing research. Being on top of this can also have a positive impact on your cash flow, we all know that cash is king and lack of ‘cash’ brings down businesses as fast, if not faster, than negative trading.
Plan for Your Future – It’s very easy to get trapped into short-term thinking when things are not going well. Lifting your spirits is hard, looking forward becomes more challenging; it can however be the best medicine to lift the gloom. When hitting a hard time it is good practice to consider the longer-term impact of any changes, cuts etc that you are considering. By doing this you will be better prepared for any impacts, also you can prepare your team and give them more clarity and certainty, which in term delivers a stronger performance.
I do hope you have gained something of use form this article and would be delighted to hear from you about what and how it works out.