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Tips For Surviving Hard Times

November 15th, 2012

It can be hard to face up to the fact that the business you have put your heart and soul into, is struggling financially.  The good news is that there are several ways of improving the situation, so the sooner you acknowledge financial problems, the sooner you can take positive steps to get you back on track.

 

Here are some tips that will set you off on the right path …

 

REDUCE YOUR EXPENDITURE

  • Are there any savings you could make on your expenditure?
  • Cut any non-essential outgoings and if you have outstanding bills that you are struggling to pay to suppliers or banks, talk to them. You may be able to negotiate a more realistic repayment arrangement.
  • Could you find suppliers with more competitive rates? Often your existing suppliers will reduce their rates to keep your custom if you find a rival company with a lower price. Price comparison websites can save time if you want to shop around. Or ask around for recommendations or good deals.
  • Are there more creative ways you can promote your business for less money? There’s a great article here with 30 free ideas to get you started…

 

INCREASE YOUR INCOME

  • Is the recession effecting your income? If people have less spending power, could you introduce free offers, discounts or reward schemes that would represent good value for money and could lead to further income
  • If customers have less money in their pockets, would they be more willing to carry on buying if you offered a cheaper version of your product or service? It’s well known that in times of recession lipstick sales go up. The chairman of beauty firm Estee Lauder called it the “lipstick index” and recent research(1) shows that nail polish is now the affordable luxury that has a boom in sales in times of austerity. The logic is that women consumers turn to smaller items to brighten up their wardrobe and give them the “feel good” factor in cash-strapped times.  What could your “nail polish” equivalent be?
  • Work out which of your good or services have the highest profit margin and focus on promoting those.

 

MARKET RESEARCH

Make it your business to find out why times are hard for your company. For example, if the number of your sales has reduced, why is that? Is there a change in trends happening? Is there a new competitor on the block or virtual block? Has an existing competitor reduced their prices? This is a good time to have another look at your USP. Do you or can you do something better than your competitors and promote that fact in your publicity?

 

GET ADVICE

Do seek professional advice especially if you think you’ve already explored several possibilities without luck. Your local small business support centre has a wealth of experience and resources to address exactly the situation you’re in.  You can bet you’re not the only one asking their advice and you may also make some beneficial new contacts while you’re there.

 

What tips do you have for others who may be struggling?

  1. Sue
    November 16th, 2012 at 22:11 | #1

    When the real recession hit 3 years ago the most important factor in keeping our company afloat was a very close eye on the cash flow. A daily cash flow was essential for knowing exactly where we were , when we could pay our suppliers and being able to tell a plausible story to the bank manager. I managed the overdraft facility and stretched it as much as I could and yes a few white lies along the way to our suppliers helped us get through.
    Other key factor in our survival was a pay freeze, reduced working hours and a paycut taken by all staff including myself and other managers. I also staggered the payroll so that there wasn’t one big payout at the end of the month.

    • November 20th, 2012 at 10:36 | #2

      Hi Sue. Some really solid and practical advice there – thank you. Much better to be in possession of up-to-the-minute information for decision-making. And helpful suggestions about payments to staff. Interesting what you say too about “white lies”. Maybe a topic for another post!

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