Modern-day uncertain economy is enough to make a small business owner’s hair fall out, bowl more than from a stomach ulcer or scrape up a rash that could cause clients to consider another place for products or services. The good news is that we know the economy will certainly turn around, in time. Your job is to work smarter and keep your business moving forward until then. That means taking a hard consider the business of your business.
As small business owners we are good at what we do plus make. Problems arise when we pay too much attention to our product or service and not enough to managing the business alone. Granted that is the part that usually mirrors a dreaded “ugh, ” but it is also the part that can indicate the difference between success and failing. Focusing on your financials, the people which make your business possible, and your vision will help ensure your survival in the current economy and beyond.
Re-Mind Your Business
Cash in or Cash Out I am sure you might have heard this a thousand times, but it still needs saying. “Cash will be king. ” A business is more likely to survive in a good or bad economy along with good cash flow than with profits. One does not necessarily mean the other. Small businesses proprietors usually have problems with cash flow no matter the economy. To improve cash flow do a price analysis of your business. Look at areas where you can save money such as bank plus credit card charges; negotiate with creditors for longer payment arrangements. Barter to get services or products with suppliers. If you offer credit to your customers, cut it down or out and be even more aggressive with collections. Consider outsourcing techniques services instead of hiring another worker.
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There are many freelancers that are experts within specific areas such as accounting and bookkeeping, website design and operations and marketing and public relations that can cost less than an employee, benefits included. Be innovative in reducing the cost of your day-to-day operations without sacrificing the quality of your product or service.
If you do large jobs, ask for the payment plan that includes a deposit. If you carry out large contracts such as janitorial services for major corporations, invoice early and ask for early payment or offer your customers a discount if they pay the invoice within a specific time frame. In a poor economy, huge corporations are looking for ways to save money too.
If you need help with your cost analysis or cash flow projections, ask for it. Worcester has many free and cheap resources to help you develop your success tactics.
While cutting costs is most important, cutting back on marketing, advertising and public relations during a poor economic climate is a big mistake. Marketing and public relations are what gain you new business. When times are hardest may be the time you want to shine even lighter than before. If you do not let your clients know you are still on board, they might forget about you when the good times resurface. And they will resurface.
Develop a no cost marketing and advertising plan that includes building media associations so you can submit byline articles highly relevant to your industry. Appear on local entry television as an expert in your field. Join in professional, community and sector networking events. Develop a customer management program that includes regular contact with customers about subject unrelated to your company as well.
Apply for small business awards and contests by corporations, professional organizations, and government. This recognition can get you attention by your customers as well as potential customers that may not know you exist. Winning an award often gets you requests from other press who want to publish your story. It also builds your credibility.
Nurture Your People
Employees It may be that with no your employees you would not have a business. During this economic slowdown, communicate with your employees. Now more than ever it is important to become transparent, ask for their ideas intended for improvement. Motivating employees is hard when they are feeling shaky regarding whether they will keep their jobs. The very best motivator is to provide them the opportunity to offer suggestion on how to serve the very best interest of everyone in the company within the long-haul. They may be willing to take a pay cut or have ideas about reducing expenses you did not think about. Move the extra step and provide praise for good work or ideas that work. They are your most precious resource. It will always be less costly to keep current employees compared to searching for qualified employees that you have to train when the economy improves.
Customers Keeping your existing customers by providing great customer service is good practice anytime. During today’s economy it is critical. It is easier to keep existing customers than to discover new ones. Talk to your customers. Learn what they need, how they are doing economically, what their expectations are for the future, so you are on your game when the economy improves and your customers start investing more.
Suppliers Supplier loyalty could be valuable when you need extra time to cope up on your account payables. Depending on your business, you may land a new account plus need supplies to launch the particular account until your first month of receivables is due which could be 60 to 90 days out. A good relationship along with your supplier could mean your payables receive the same time consideration. Think creatively when making deals to grow your company with the help of your suppliers. The more growth your business experiences, the more business your own supplier could expect.
Focus on the near future
Business Plan Review and modify your business plan. As your business grows and your industry changes it is necessary to keep your business plan relevant. A well-thought out business plan that includes your cost analysis, new marketing program and employee and customer administration programs is critical to a quick and successful recovery. It can ensure the future viability of your business.
Carrie H Johnson is founder of three businesses including a cleaning support she started with no money and grew to a multimillion dollar contract-cleaning company that supported 165 workers. During her 17 years as President of this company she received several business and community awards.
She is the author of the book “From the Pits to the Palace: One particular Woman’s Journey to Self-Realization via Entrepreneurship” released in March year and available on Amazon and bbotw. com (Buy Books on the Web). She also is a journalist and it has written for several newspapers including the La Times, Worcester Telegram and Gazette and the Metrowest Daily News.
Ms. Johnson is a small business adviser devoted to business planning, public relations and advertising planning. She works closely with all the Center for Women and Enterprise (CWE), a nonprofit organization whose mission is to empower women to be economically self-sufficient and prosperous through entrepreneurship.