Top tips and survival strategies to create a booming business in an economic downturn
Times are tough but you can actually build your business and grow your business income, even during this tough economic climate, if you employ the right strategies.
In fact some small businesses have found their income is booming in the recession. I’ve interviewed scores of company owners and self-employed people to establish just what it is that separates the winners from the strugglers in times like this, and here’s my summary of what they are doing right, that you can do too:
1. Refocus: in good times it is easy to have a scattergun approach to sales and marketing. Clients, customers or companies who might not be natural buyers from you have the budget to indulge side-projects, and you are the beneficiary.
In a recession, when budgets are more tightly controlled, only the essentials are purchased. Therefore, it’s time to refocus your business and identify which customers regard your products as essential.
2. Define your customers: In order to know your core market, you need to define your key customers. How to define your customer? Think about the following: from whom have you had your best repeat business? Who provided the funds for your single biggest source of income last year? If your market is seasonal, what additional products might your key customers need at other times of the year?
3. Visualise your ideal customer as a person, give them a name and think about what is their definition of a good day. You can find greater detail on this at Liz Strauss’s business blog: Successful Blog where she explains how to understand your customer and your market.
4. Identify your unique offering: What are your personal qualities, and those of your business, which make you different from other competitior businesses? Go through the feedback you have received from past clients – what was the recurring theme of their positive experiences? When you distill down what it is that makes people return to you, you can build on this and incorporate it into your marketing message.
5. Be confident in your pricing: How to charge more for your business and services? When you have defined your USP, then you can explain to customers the added value that you are offering. It is business suicide to compete on price alone, because there will always be those who are cheaper than you. If you can justify being “reassuringly expensive” – in terms of enhanced client or customer experience, value and outcomes – then you don’t need to reduce or discount in order to grow. You can’t do this unless you have followed step 2, which is to identify who your key customers are, and what they define as “value”.
6. Be disciplined about your time: Try to establish which effective marketing campaigns – newspaper ads, website, blogging, Twitter, Facebook, personal referrals, webinars, trade shows, speaking engagements – have generated the greatest and most lucrative leads. Especially if you are an owner-manager of a business you can’t afford to spread yourself too thinly, so work out what is the most productive use of your time. Measure your results through Google Analytics and other web tools.
7. Create positive habits: When you work alone or in a small business it can be mentally challenging to stay focussed during lean periods. Have a strategy for dealing with times when income is not coming in regularly – such as budgeting for quiet periods, keeping cash on deposit to maintain positive cash flow when clients pay late, and building in sufficiently daily periods of rest, relaxation, and exercise.
8. Let go of the old stuff: it may have worked in the past, but if the market has shifted and it is not working now, don’t continue to flog it. Move on. You need to know when to change business branding, especially if you have identified that you are not currently playing to your full strengths. The book “Who moved my cheese?” takes only an hour to read, costs less than £4 but will make you rethink your objectives and challenge your attitude to change.
9. Think positively: Resolve to implement one positive action every day that will grow your business, produce additional income, raise your profile or promote your brand. To quote Aristotle: “We are what we repeatedly do. Excellence therefore is not an act, but a habit.”
10. Pay down your debt: Interest rates are historically low, but are certain to rise over the next 12 to 24 months. Position your business well, maintain healthy cashflow, and reduce your overheads as much as you can. Debt is often necessary when you are establishing a business, but you should aim to get out of debt as quickly as possible, because until you do, the profits you are making are benefiting the banks, not you or your business. Check whether personal loans have penalty clauses for early repayment, and consider using the money saving tips in my last blog post to make extra money to free up cash to pay off debt, invest in marketing, or reposition your business.
Regards, Marianne Curphey