Growing your business can be challenging at the best of times, and even more so with an uneasy economy. However, alongside the challenges, there are opportunities.
Increase Market Share
If things are tricky for you, chances are they’re tricky for your competitors too. Have a look at what they are doing. Are they laying off team members? If so, you might be able to take on their most talented employees. Are they cutting back on products and services? That might offer a chance to increase your market share, by snapping up customers whose needs they no longer meet.
Keep Standards High
If competitors lay of team members, then the customer experience with that company is likely to deteriorate.
Think about areas where those firms might now be struggling. They will probably include things like fulfilling orders and resolving customer queries, and perhaps even basic stuff such as answering the phone, returning calls, or responding to emails. See what you can find out through the grapevine. Unhappy customers may complain on social media, friendly suppliers may have information, and if you do snap up any team members who were let go, they might also be a good source of information.
At the same time, you should make sure your company provides an excellent customer experience. You could use this opportunity to establish your reputation as a dependable customer-centric business whose people always do what they say they’ll do. Gather testimonials and reviews and promote them as social proof of your quality.
Cash Flow is King
The key to not just surviving but thriving during a recession is cash flow. You should understand how money moves through your business, plug any leaks and free up inlets. GreenStones can help you budget for the coming months with our Forecasts and Budgets service.
Reduce Money Going Out
Remember, you’re not the only one dealing with the current economic climate – suppliers are too. You might find they are open to negotiating more favourable payment terms. If you are currently on thirty days, perhaps you could agree sixty days, or even ninety. It costs nothing to have the conversation, and you will continue to benefit when things pick up again.
Look at what you are offering customers. This might be the perfect time to eliminate any products or services that are a drain on cash flow and don’t pay their way. As well as pruning things that don’t earn their keep, you free up resources that can instead help boost more profitable activities. That said, think twice before cutting back on promotional activities. If your competitors are cutting back and you don’t, you can potentially increase your market share as you will be more visible.
Boost Money Coming In
When it comes to you as the supplier, you want to do the opposite of what we suggested above – you should be looking to reduce payment terms offered to customers, not extend them. Aim for pre-payment or payment on delivery, rather than credit terms. Ideally, get recurring customers on regular monthly payments by direct debit, so you can more accurately forecast cash flow and plan expenditure.
Your goal should be to reduce the average number of days outstanding. You should also make sure you chase unpaid invoices. Aim to keep the amount of debt to a minimum, keep that cash flowing!
Monitor the Big Picture
Growing your business in troubled times might be challenging, but it is possible. Keep an eye on what’s happening in the marketplace as well as in your business and leverage opportunities wherever possible.
For further advice on growing your business, give the team a call on 01733 371180. The GreenStones team would love to hear if you have any tips or plans which you have used to grow your business.