How to Prosper...in Times of Turmoil

The economic storm clouds have yet to disappear as the credit crunch continues to chew its way through millions of people. You may well be panicking because of the global gloom and doom that started with the banking crisis, but if you’re a small or medium sized business, it doesn’t have to be the end of your world. And we’re not talking about mere survival here—for savvy entrepreneurs this is a brilliant time to grow your business and prosper.

Granted, it’s tough out there right now. But when your back is against the wall, so to speak, this is the time when enterprise truly pays off. Don’t just try to ride out the storm—that can be a recipe for failure and disaster. There is little point retreating into a shell and sitting tight in the hope that you’ll survive. To make sure your business thrives during the downturn, you need to take a good hard look at your operation before switching strategies. Whatever you do, don’t panic and lose your head! Here’s how you can flourish during the dark days ahead.

Trim the fat

Review your company finances in a calm and collected manner. What do you need to pay out and what is owed to you? Make sure that you are being paid on time. Then look for waste and how you can save—there will be some. Small and medium sized companies are more agile than big businesses, and it’s easier to adopt efficiencies—but don’t cut corners. Even small savings like not leaving your computer on standby and making sure all the lights are off at night will help. Eliminate expenditures that are not essential to your core business.

Know your customers

Continue to offer a great service above and beyond what everyone else is doing. Make sure every customer feels that they are extra special—VIPs even. Spend time with them and find out more about their needs. Every effort should be made to deliver what they want. A customer satisfaction survey could tell you if any of their needs are not being met. Can you come up with new ways of making sure they come back to you? Remember, selling to existing customers is easier than winning new ones. And a contented customer will bring repeat business and possibly new customers, too.

Nurture solid relationships with suppliers, and of course, bankers. It’s even more important that you manage these relationships well during times of chaos. Also, strengthen the bond with your team—a good, strong workforce taking on the world will keep morale high. It’s more important now than ever before to have a great team. Remember, they are going through difficult times themselves. As they watch the recession headlines, they will become fearful for their jobs. They need to know that the business is well-positioned and that there is a good, strong leader at the helm who will steer them safely through the troubled waters. Meet regularly and energize them with your bold visions.

Stay ahead of the competition

Research here is invaluable. Find out what you’re competitors are up to and if you’re not doing so already, make sure you’re competitive with your quality and service. During difficult times as people are laid off from companies, some will inevitably start up their own businesses. These new businesses may encroach on your sector. Take the time to see if there are any new arrivals.

Enhance your offering

Cutting prices is one way of making your prospect more attractive, but it is by no means the only way. And this shouldn’t be your first course of action. Don’t overreact to market conditions. Once your prices go down, it can be very difficult to bring them back up, and you might even compromise the integrity of the product or of your brand—especially if your business is selling luxury items. Instead, you should be looking to enhance your offering.

Can you create special offers or add bonuses to what you’re already doing? Perhaps you could cut delivery times or add incentives for large orders.

Stay tuned

Keep your antennae tuned to economic trends—don’t ignore them. Prepare for the upturn, perhaps even help to lead it. If you’ve got money, this could be a good time to invest in a new home or office or refurbish the one you have.

It’s also an excellent opportunity for you to invest in new staff. There may be a pool of talented people who are now available, having been let go by their previous employers. Recruit the most talented ones.

Adapt to the market

If you see that sales are declining in one area, concentrate efforts on the areas where sales are increasing. Don’t waste your time on something that’s beginning to freefall. If your business is based on a single product, perhaps you should consider changing your position. If customers aren’t buying from you, who are they buying from? It’s important to remember that customers don’t necessarily go away during times of recession, they just behave differently. Some are more cautious and choosy and your company should react accordingly. For example, people may not dine out in restaurants as much, but they might buy more things to enjoy at home. Be ready to adapt to people’s changing needs.

Invest in you

Now is a golden opportunity to build on your knowledge, skills, and talents. It’ll
enhance your reputation with customers and colleagues, and will improve your standing as an expert in your field. Do all you can to face new challenges, set new goals, and head for new horizons. Read more, attend conferences and seminars—take the time to upgrade you!

Make more noise

This is not the time to shrink away—you need to carry on with advertising. If you can increase your spending a little, you should—but you may find that you have more flexibility when negotiating contracts. If your competitors are cutting back, you may be able to obtain discounted rates or better ad placements.

Look for other ways of getting your message out there, such as harnessing the power of the Internet—you could blog or join web forums in your field. You could also write a column for a local paper. If your competitors are quietly riding the recession, then this is your big break! Stand out from the rest of the pack and get your message heard.

Prepare for the good times!

Recessions are periodic events. This is not the first, and it will by no means be the last. Don’t make the mistakes that many businesses make during a financial crisis. They want to hide away and cut back. While this is an understandable reaction, it is not a smart solution.

A well-run business will be able to hold its own in difficult times. If you are offering a great service, have good customer relations, are flexible, and can make good, quick decisions, you will be able to prosper while everyone else is experiencing money meltdown.

Come out fighting and energize your business to ensure that you don’t go the way of the dinosaurs. The good times will come again—this is your chance to make sure you’re a part of them.