Economic Slowdown in India
Consumer confidence can decrease over time if you don’t properly run your business. Decreased sales threaten all businesses, be it small or large, but small businesses are particularly susceptible as they often don’t have the required cash reserves to help them beat difficult times.
How can you recession-proof your business? How can you tap into business opportunities during a recession? What are some good businesses to start in a bad economy? In this article, we discuss best practices to recession-proof your business. Ensure your small business’s survival—all the while allowing it to thrive during tough economic times.
1. Protect Cash Flow
It is important to protect your cash flow. Keep an eye out for what’s coming and what direction your business is moving. Be aware of changing economic conditions. Prepare cash flow projections in advance. This will help you to visually see what you need, and the changes that need to be made in order to meet that cash flow. Keep an eye on your cash outflows and see ways to maximize your cash inflows. Collect receivables sooner. Stop giving your clients free credit at the expense of your business’s survival. Also, be professionally aggressive in your cash collection processes.
2. Don’t Let Go of Your Existing Customers
It is important to keep an eye on your business expenses and cut expenses wherever possible. But it is equally important to not cut so much of your business expenses that you can no longer service your most loyal customers. Now is the time to put your business vision into action. Remind your customers why they chose you in the first place. Whether your service/product is the most cost-effective, or you offer a premier product or superior quality service—remind your customers of the exceptional value you offer.
3. Important—Keep Your Best Customers Even Closer
The loss of your best customers—which translates to your biggest accounts—could be disastrous for your business. Find business opportunities and strategies during the recession. Call, email, or send a discount card to your best customers. An example would be to tell them how much you appreciate their loyalty and continued patronage. Let them know you’re willing to work with them. think of a long-term contract—this is a great opportunity to keep your best customers! Another idea would be to offer to buy them lunch or a cup of coffee to discuss your current and future business relationship.
4. Lower Inventory Costs
See how much cash is tied up in inventory. Lower your inventory costs, wherever possible. For instance, you may be able to reduce the amount of inventory you are holding, thereby releasing much-required cash. Are you ordering too many of particular products? Can a change of suppliers/vendors provide you with reduced expenses? While you are at it, you might even consider settling your worst selling products.
5. Revamp Your Marketing Campaign
Slow business calls for new marketing campaigns. Consumers behave and spend differently in a recession. They want to get more value for their moolah. Position yourself as a great value provider. Highlight the amazing value for money you offer in every marketing campaign. Drive this message deep.
6. Develop and Implement Marketing Strategies to Win the Competition’s Customers
If you want to thrive in tough economic times, you need to continue to expand your customer/client base. This means drawing in customers from the competition. How do you go about this? Firstly, research your competition. This means spending on some solid market research—but its ROI is always immense. For instance, if you are a business based in Pune, you might want to search for market research companies in Pune. It would be also a good move to consult a marketing strategy consultant to see how you can develop and implement strategies.
7. Offer Exceptional Customer Service
Offer something different than the competition does. See what you can offer to lure your competition’s customers into becoming your loyal customers. Here is a tip: providing exceptional customer service is one of the easiest ways to win the competition. Customers always prefer outstanding customer service.
8. Don’t Cut Back on Marketing
It might be tempting to think of marketing as an expense, but believe us, you don’t want to cut back on your marketing expenses. This is the #1 mistake many small businesses make during a market slowdown—they make the mistake of cutting their marketing budget or sometimes, they even eliminate it entirely. But a market slowdown is exactly the time your small business needs a revamped marketing. A good way to start is to hire a marketing strategy consultant.
9. Influence Customer’s Buying Decisions
During a market slowdown, consumers become restless and look to make changes in their buying decisions. Help consumers find their products and services. This is where a solid marketing strategy comes in useful. Reach out to them as opposed to them reaching you.
Ourbusinessladder is a business consulting company, specializing in market research and business advisory. We are one of the leading market research companies in Pune. With our 360-degree approach, we help businesses of all shapes and sizes. We provide all sorts of business consulting services. We guide businesses to grow through market research, business advisory, branding and gamification strategies.