BUSINESS LINK ANSWERS YOUR QUESTIONS
How to Survive difficult times
Whether the so called credit crunch will turn into a recession, or how bad things are likely to get, I have no idea; I'll leave others to speculate on that.
However, a number of my clients are feeling the effects of the slowdown; for all of them it is rising costs and for some this is coupled with falling sales. It is worth noting though that some are experiencing a lift in sales because less well managed competitors are already failing.
This is not the first economic slowdown and I doubt it will be the last. It is possible for a good business to survive, thrive and emerge stronger from difficult trading times, countless business have proved it in the past. So what is the secret? For that you will have to wait for the book to be published, but in the meantime let's look at some of the basics.
Seeing it from the customer's point of view.
Start with your existing customers and find out what they like about your product / service, your customer service and any other contact points they have with your company. What benefits do they get and what makes them buy from you? What would they change? What might they buy if only you sold it; what might they buy more of if you changed it in some way. Some leading and potentially tricky questions there, so be careful how you ask them. I would avoid questionnaires, and speak to customers direct. It might inspire them to do the same. But do think very carefully about the information you want and therefore the questions to ask as well as the way to ask them. For instance, should you reel off a list of questions or should you structure them into the conversation?
It is also important when you meet with potential customers, either formally to sell or when networking, to find out as much as you can about what they need and the triggers for the buying decision. When you meet existing or potential customers spend less time bombarding them with what you do and more time finding out what they want.
This might be a good time to contact lapsed customers as well.
Of course you need to put all of the answers together so that it is meaningful for you, to enable you to start to build a picture of what changes you need to make to beat the competition.
Fail to plan, plan to fail.
No I haven't swallowed the dictionary of clichés! But there is no point discovering what you need to do to change and improve the business in order to survive (and even thrive) in a recession unless you plan to do something about it.
Providing you have asked the right questions and interpreted the answers correctly, the things that you need to change should now be starting to emerge. The detail of what to do, who will do it, by when, how and at what cost will be the components of the action plan. Some things to consider will include: what can we do immediately or soon i.e. quick wins? What are the longer-term changes needed, when and how should we implement them?
This is not about making expensive changes; this is about identifying improvements within your current resources and budget. Of course some of you will identify the need for larger capital investment but the pros & cons of investment appraisal are beyond the scope of this article.
Also beyond the scope of this is the all important subject of cost control, how to protect the profit you are making, so we will look at that next month.
This is a big subject, and this was a very limited stab at it, but I hope it is food for thought at least.
So, whatever the near future holds, this is a good time to review your business.
We can provide you with free, impartial, skilled help to do this, just call us on 0845 607 6117, visit our website, or call me direct.
That's all for this month.
Peter Mulhall
Business Adviser
tel: 07717 290309
p.mulhall@businesslinkeast.org.uk
Business Link - the place to go for business support
Online: www.businesslink.gov.uk/east
Return to News & Advice listing page
