Are you tired of hearing about the slowing economy? Fewer openings, more layoffs and everyone wants more for less, while the expenses keep creeping up. Banks are getting tough with their lending practices. Times are tight, but this is a perfect time for an aggressive small business. Get smart about your marketing and business operations to recession proof your business. The two most important things to consider is marketing and cash management.
Here are 15 tips to kick-start your business.
- Keep the marketing going. The first instinct may be to reduce or eliminate marketing expenses. If you can’t afford a full-blown marketing program, pursue less expensive options such as media releases, public relations, targeted direct mail, e-mail blasts, social marketing sites, blogs, article marketing, and online newsletters.
- Keep in close contact with your customers. Understand how their business is being affected by the recession and look for ways you can help. Lasting relationships are built in hard times.
- Start collections at 45 days. The days of waiting 90 days are over. You need your money now. Once a client gets to 45 days get on the phone and track down the accounts payable manager for an update.
- Produce a three-six month cash flow projection. Right now it is extremely important for you to understand your cash position. Determine where you can cut costs, and make sure on a weekly basis that you understand what money is coming in.
- Use the 2 to 1 rule. For every $2 dollars you cut in costs, invest $1 into your marketing efforts. This is no time to cut back on marketing.
- Add value, not price. Continuously adding value to your products and services is the way to get repeat customers and new business. Adding price without value is a lose/lose proposition.
- Offer a temporary price cut. If you have retail business, consider cutting prices by 50% or doing a 2 for 1 deal. If you have a service business with a retainer or monthly fee, consider the first three months 50% off with a 1 year contract.
- Under Promise and Over Deliver. Excellent customer service is the number one way to encourage your customers refer you more business. Be known for delivering great products and services.
- Network, network, network. Be everywhere. You want to be top of mind when an opportunity presents itself. People do business with people they know. Face to face contact is really the way sales happen.
- Give to get. Look to give first before you get. When you meet a new contact, think solutions for them first or WII-FT What’s In It For Them.
- Consider adding staff. One good thing about layoffs is lots good people are on the market. You could pick up some quality talent you could not otherwise afford. Hire a salesperson and pay them commission only. Make them kill what they eat.
- Weed out unprofitable customers. Every company has customers that cost more than they add to the bottom line. Identify them, evaluate how to make them profitable customers, and if that’s not possible cut them.
- Keep your personal credit high. Your personal credit is your small business credit ultimately.
- Watch your business credit closely. Pay down some principal on your lines of credit. Curb your spending on your line and don’t give the bank a reason to charge you late fees.
- Call the bank before things great critical. Regardless of your business situation, you need to communicate with your banker. The bank does not benefit if you go out of business, so stop the denial and negotiate better terms with your bank.