Recession doesn’t have to be a bad thing; it can actually encourage business owners to think and work smarter. In the first of a monthly sales and marketing series, expert Sharon Williams puts a positive spin on tough economic times and shows you how to reinvent your business to stay ahead of the game.
So the recession has either left your business booming and you are drowning from keeping up with demand, or you’re realigning expectations for holidays in 2009 to be a comfortable tent in the backyard. Extraordinary times for all.
Either way, the New Year brings opportunities for change and improvement, whatever the state of your business. I believe those that have had it tough are more likely to be ready for reinvention in 2009. There is no doubt that tough times make you smarter.
One customer likened the past three months to pouring his business through a sieve; what remained was all the good stuff. Many of my customers have said something similar, streaming out what isn’t productive and holding onto what is really important. This is a strong positive about recession; it encourages us to focus and make better use of our time and resources, however painful the process can be. It takes you into a new space which, if you are smart, looks mean, lean and hungry. It can be a great place if you want to fast track to more successful business practices.
Just to recap, this is what you should have done already:
1. Ask for help. Don’t panic. Meet with business advisors you can trust.
2. Know your numbers. Review your costs
3. Cut big costs hard. Don’t salami-cut, cut big, cut once, cut fast.
4. Stop spending.
5. Stay close to customers. More than ever.
6. Focus on sales.
7. Continue spending on sales-related activities.
8. Forecast for 30 percent sales down for the next 12 months.
9. Cashflow forecast fortnightly, if not more often.
10. Communicate with your team regularly.
And it never hurts to smile and look positive, even when you are exhausted!
Having your own business is an issue of tenacity, decisiveness and clear, rational thought. As business owners, we’ve never needed more courage and tenacity than during this last few months. So how do you kick off a New Year full of hope and glory?
Be prepared to re-define your plan
It’s a new world out there, whether you like it or not. Review your revenue objectives and where you’re going to focus for the next 12 months. Whether business is booming or struggling, it’s naïve to think recession isn’t going to hit you somewhere, via your suppliers or your customers. It will have an impact on someone close to you.
Re-define how you account for and control your money
Evaluate and consolidate your new cashflow systems and remember you don’t have to do this paperwork yourself. Get your book keeper or PA to do it for you. Have your essential reports, balance sheet and profit and loss statements delivered by the fifth of every month and cashflow estimates three-to-six months ahead. Have your accounts payable and accounts receivable delivered each Monday and chase money voraciously. Even look at invoicing more regularly or increasing your prices.
Find every way to talk (not just email) to your customers
Partner with your customers and work alongside them; use the New Year to reconnect. This is easily said but few companies will do it effectively. There is no need to sell them anything with every communication, but let them know you are there and offer them assistance; some free value-add you have at your fingertips will help. Genuine care puts you front of mind. Reconnect with them; throw a cocktail event, survey them, talk to them, get face to face. Find out how the world has changed for them. They are almost certainly in the same boat. Those that stick together, succeed together.
Internal communications
Be open with your team and communicate the New Year’s goals as soon as everyone is back from the break. Organise a formal or social kick-off if need be and communicate your objectives clearly with KPI indicators. Educate your team on how important it is that everyone plays a sales role and pulls together for success. This is a great chance to increase accountability throughout your company and change the way you measure performance.
Maintain and innovate around your database
Anyone who knows me, knows this: in my opinion, your database is the single most important piece of intellectual property (IP) in your business. If all goes belly up you can re-start a new venture almost the next day (falling in line with privacy laws). Pay someone if necessary to update the database and keep accurate records of customers, suppliers and prospects. Record where your business is coming from and do more of the same. Most importantly, ensure you can run marketing campaigns via a database you can trust.
Take a hard look at your customer base
Recession gives you the chance to redefine your customer base. There are those you realise are just simply more bother than they are worth and others who show their true colours and are worth pursuing. When time is tight and stress levels are high, it’s a great opportunity to evaluate who is worth the effort and who isn’t. Sieve your customers and segment them. Divide them into groups defined by size, spend and industry. This will give you renewed clarity on exactly who you need to communicate with and parameters around where you need to go to reach them in 2009.
Review your brand
Brands can get tired. Take the opportunity over the break to check in on your brand. Does it need to reflect new, more cautious messages? Is it consistent? Is there a chance to throw caution to the wind and spice it up? After all, it’s a new year, a new beginning. Audit whether your messages are clear and consistent throughout your business; this is critical. People have got to believe what you’re promising. Your website, brochures and events should reflect the same core values and key messages. And remember, quite simply, consistency builds brand faster and cheaper.
Implement new standards of measurement
From your staff accountability to your operational, marketing and PR spend, get smart with measurement in 2009. These expenses come straight off your bottom line so it is important to establish KPIs and goals around any financial investment for you to evaluate success. Delegate to your staff these tasks as mini ‘accountability’ projects; everyone wants to feel important, particularly in challenging times. And remember, there is no excuse not to do it just because you are busy. Check what return you are expecting from each activity before you lay out precious dollars.
As Peter Knight, CEO of Knight Partners accountancy and advisory firm, explained in his recent recession busters piece to customers: “It’s a new world we operate in now, and a tougher business environment so innovation is a necessity, not a luxury. There is no need to take this on alone. Meet with business advisors, find outsourced specialists if you need to, but don’t rest on your laurels. You risk the world moving on without you.”
-Sharon Williams is the founder and CEO of Taurus Marketing (www.taurusmarketing.com.au), a PR, marketing and creative agency. She is the resident marketing and PR expert on Kochie’s Business Builders on Channel 7 and the newest member of Dynamic Business magazine’s expert panel.
Seeking to promote your business? Create your free Australian business listing with Dynamic Search business directory – Sister site of Dynamic Business.
