How to Keep Your Company Afloat When Business Is Slow
By TRISOFT team
In today’s uncertain and challenging times, it might be a struggle to adapt to the new conditions and keep your business productive at the same time. Some entrepreneurs have sacrificed their activity in order to catch up with the newest developments and regulations, while others have tried to make the best of both worlds, adjusting their enterprise as they went. But while a business slowdown is rare and one of this magnitude outright unprecedented, there are steps that each company can take in order to come out the other side relatively unscathed.
The first and most important tactic is communication — talk to employees and tell them what’s going on, what measures you might have to take in order to make it through these trying times and listen to their suggestions and concerns; be transparent with suppliers, revealing that you might need them to be flexible in collecting payments for a while, that merchandise orders might be low in the near future, but reassure them that your relationship will endure after this dire episode; and last but not least, keep your customers informed, because they need to know what is happening to you and they will be the ones who will help you recover once the worst is over.
2. Work with expenses
From the point of view of finances, the key is to collect as much as you can from what others owe you and to reduce expenses and costs to a minimum. Although you must keep in mind that others are experiencing problems just like you and you might need to come up with a long-term debt collection plan, every dollar you cash will help you pay salaries and bills and invest in the future rebirth of your enterprise. Then take a look inside the company and see where the money usually goes and what changes you might need to implement in order to cut back on spending. Postpone investments in office furniture or supplies, raises, bonuses and gifts. Employees might not be happy, but it’s still better than being left without a job, if expenses surpass income and the business goes bankrupt. Search for cheaper stocks, without reducing the quality of the materials, lower shipping costs and more efficient equipment. Also, you should consider accepting a pay cut yourself, as well as enforce it on other executives, since employees need to know that their finances aren’t the only ones affected, but rather everyone is in this together.
3. Do the marketing
Refocus your marketing strategy — the market needs to know that, although your business is significantly reduced, you’re still in the game and haven’t vanished completely. Go online and communicate via media platforms, forums and blogs. If the activity domain allows you to, offer your services online, through dedicated platforms and apps. Thus, rent and transportation costs are reduced and you can meet clients wherever they are. Study your competition, see what they are doing right or wrong, learn from it and try to fill in the blank spaces that they haven’t covered.
4. Keep positive
One of the best and most important things to keep in mind when the company is facing a decline is to keep a positive attitude and look towards the future. Remember why you started the business, what drove you then and what continued pushing you forward throughout your journey. The drive, the passion, and the dedication are still there and will guide you through this difficult period. Of course you mustn’t lose sight of what is happening now, but if you become immersed in the negative aspects, you won’t be able to get past the current obstacles and survive the slowdown. Your internal strength will give you the power to overcome the hardship.
5. Use what you’ve learnt
After the dust settles (and it always does), it will be crucial to get back to work and use what you’ve learned during the hard times to strengthen your company. Ask yourself if there was anything beneficial and constructive to take home from this experience and incorporate it into your activity, so that you will improve and expand it. Maybe some of the changes you operated will remain as a constant in the company and help you in the future. Maybe they were innovations you had been putting off for a while and that you were forced to implement now, in a rush. Why go back to the way things used to be? Consolidate the changes and build on them. Be open to new business models.
6. Plan ahead
After all this, it might be time to sit down and start planning for the next economic downturn. You never know if and when it’s going to happen, but it surely shouldn’t catch you off guard like this one. Whether it’s caused by a recession, a natural disaster or episode two of this pandemic, it’s essential to take precautions so as to guard yourself against future threats. Keep a few projects on the side, which might help you gain revenue in times of trial. Even if it’s something brief or transient, it’s still better than doing nothing and gaining no income, while waiting for your main business to pick up again.
Another fundamental principle is to always have cash in the bank. No matter what happens, money can help you bounce back from a tight spot and facilitate the survival of your company. Do your research and plan for any possible scenario you can think of.
And music keeps playing
All in all, slowdowns are never fun or desirable, but there is always something to learn, even from the most difficult of experiences. At TRISOFT, we try to learn the lesson, build on it and be ready for the next exam that life throws at us. Because it always does, doesn’t it? :)