2017 has been a year of some unexpected and unbelievable changes in the financial world. These changes have forced businesses of all type and sizes to go ‘back to the drawing board’. While starting from the basics, these 11 ways businesses can survive in difficult economic conditions will prove helpful.
Here in this article, we have covered the common factors for SMBs to large organizations to help them survive.
Of course, tough economic conditions can bring some additional challenges for business owners.
In addition to facing the competition, business owners have to make many changes to stay competitive. Business owners who are wondering how businesses can survive in difficult economic conditions, they have come to the right place.
11 Effective Ways to Survive in Difficult Economic Conditions
Protect Cash Flow
One of the biggest challenges business owners will have to face is to deal with the cash flow issues.
It is a mere fact that expenses are sure to continue until business exists. Most of the problems you will face will be to keep cash flowing in.
Cash Flow in Business is no less than Blood in Human Body, Keep the Momentum Going!
This is where your cash flow management skills will come out to play. Cash flow must be managed wisely.
Here are some ways you can increase cash-in:
- Bill right away and don’t let the money you owe sit in the bank accounts of customers.
- Ask for partial payments, be business minded and collect advance as soon as orders are received.
- Reward customers making quick payments.
- Collect all your receivables and check out your receivable files today!
- Don’t be in a hurry to pay bills, they come with due dates.
Reduce Marketing and Advertising Efforts
Sometimes, business owners have to play defensively to survive tough economic times in business.
As soon as you can, track the money that you are putting in marketing and advertising. Of course, these activities are must for your business.
But, there are some activities that you can stop until things in the market are stable.
First, eliminate the marketing activities that you are not getting output from.
Moreover, don’t make any change in marketing efforts that you are cultivating benefit from.
Try Reducing Costs
Apart from the cost of marketing and advertising, expenses in business are endless. Track all the expenses that are eating up most of your cash.
This way, you will have a better idea of what are the ways you can save more cash in your business.
You will find a few things in which expenses are not needed.
As every penny counts, even a small Change Management can add value in your business and keep the cash flow going.
Focus on What You Do the Best
When tough economic conditions take place and you find it tough to survive in business, focus on core competencies.
Put your focus more on what your business does the best. Be it a product that is heavily in demand; try to make the most out of it.
If you are offering any service that only a handful of businesses do, focus on it.
You know your strength, you know your customer base and their behaviour, keep working on it.
When going gets tough, tough gets going, be unstoppable!
Quality is Mandatory
One of the mistakes that most small businesses make is to decrease the quality of the product and/or service.
When time is tough, never play with the quality of products and services that you are offering.
In the event when customers will notice this, you can end up losing a customer.
Customers are intelligent and they know what they are buying and how much they must pay.
If you are not quality focused, customers will surely make a switch and choose another business for a similar product or service.
Instead of quality, better reduce offers and discounts that you are offering for long.
Especially e-commerce portals and businesses in shopping malls offer a lot of discounts to attract customers.
But, when customers know the actual value of your products, they are sure to pay for it, even if they don’t get discounts.
Such offers are best when implemented in seasonal business or when the market is stable, not when economic conditions are tough.
Remove those tags with 10%, 20% discount on your products from everywhere you can!
Track Cash-in and Cash-out
As a smart business owner, you must already be tracking cash-in and cash-out.
But, business survival in tough economic conditions needs effective cash tracking.
Keep an eye on every single penny coming in and going out of your business.
It can be difficult at times when you are busy in other business activities, but it works well. If possible, track things daily and start today!
New Strategies to Increase Sales
There must be something that you haven’t tried yet to increase sales and profitability. Any pending sales enhancing activity that you think can work?
Yes, think over it as any idea can work wonders even in tough economic conditions.
For more help, browse the web as you can find plenty of ways that work and increase the sales in business.
Try implementing any of those given ideas that you think will work for your business.
Focus more on Existing Customers
Your current customer base, the existing customers can be of great help to survive in difficult conditions.
If you know the buying behaviour of your customers, you must know what will attract them.
Make the most out of your current customers and try your best to attract them to your business.
Create Strategies to Attract Customers of Competitors
Have you ever tried to be smart enough to attract a customer of your competitor?
If not, then this is the right time to do so.
Develop some strategies to reach and connect with the customers of your competitor.
If needed, give them discounts, offers, the best deals you can, all you need is to make them your customer.
It’s your turn to make things happen and keep things going, do whatever it takes to build the momentum.
Ensure Employees are Well Trained
Keep your calm in tough economic conditions; don’t let it affect your business or your employees.
Train your employees in a way that they work as per the current situation, increase productivity and sales.
If you have provided sufficient training to employees, they will do what best they can to achieve maximum productivity.
These are some basics, the common factors that every business can implement in tough economic conditions.
As you already understand your business well, deciding out of these 11 factors will not be a tough task.
Be smart while making these strategies work for your business and hope for the best!