TIP: Thriving in a Weak Economy
Tip of the Month
TIP: Thriving in a Weak Economy
Economists believe that we should expect slow growth for the first quarter of 2009 and some believe that this pattern might extend into the second quarter, too. Spending cut-backs, tough economic times, and consumer caution are challenges for all businesses, large and small. Modest growth is an improvement over stagnation. Here are a few ideas on how to keep growth—albeit at a modest rate —a factor in your business.
- Increase marketing efforts
It may run counter to your initial instincts to save money, but this is not the time to reduce efforts to reach new customers and to seek more business from existing clients. However, it might be the time to use less expensive tools, and to look for every way possible to leverage your marketing dollars. If your budget is smaller, look for more cost-effective ways to reach your target markets. Traditional advertising media may be too expensive right now, but a web-based promotion, or a phone campaign to a specific section of your audience, could produce cost-effective sales or business opportunities. Don’t neglect public relations, especially media relations opportunities. Cheaper, yet more credible than paid advertising, publicity offers a substantial bang-for-the-buck. The options are many. You might:
- Offer to write a “how-to” column for your local newspaper or for the online version of your metropolitan daily;
- Identify guest expert “slots” on local talk radio stations or opportunities to participate in TV morning chat shows;
- Look for opportunities to showcase your firm’s expertise with a workshop or a presentation at a local chamber of commerce meeting or appearances before various business networking groups.
- Offer incentives to spur repeat business; strengthen customer relationships
Your customer base is experiencing the same slow-down and anxiety that you are. If possible, consider offering valued customers special incentives. If you have long-term valued relationships, you have the information you need to customize the incentive to suit the specific client. Depending upon the nature of your business, it may be possible to offer more advantageous terms to customers who pay upfront. Alternatively, perhaps it is possible for you to offer clients some “add-ons” to initial purchases at reduced rates. Check out what tactics –discounts, special deals, etc.—your competitors are offering, and make sure you know if the competitive pricing in your business sector is undergoing change.
- Keep on top of spending and revenue
It is crucial that you have the systems in place to monitor expenses and revenues in real time. Consult your tax and accounting professional to evaluate your current situation and seek recommendations on what you might do to improve your ability to track your business’s financial position.
- Keep employees informed and motivated
Be honest about the challenges of today’s economy, but remain upbeat with your employees. Nothing destroys morale faster than poor in-house communications. Involve employees in the process of doing business smarter. Solicit money-saving ideas and cost-cutting suggestions from everyone. Host a “brain-storming” lunch and take the lead in identifying issues and practical solutions.
Business owners who adopt new and creative thinking, and a positive attitude towards staying on track during the current economic downturn, will reap the rewards when the inevitable rebound occurs.
These articles are intended to provide general resources for the tax and accounting needs of small businesses and individuals. Service2Client LLC is the author, but is not engaged in rendering specific legal, accounting, financial or professional advice. Service2Client LLC makes no representation that the recommendations of Service2Client LLC will achieve any result. The NSAD has not reviewed any of the Service2Client LLC content. Readers are encouraged to contact their CPA regarding the topics in these articles.