With the economic collapse of 2008 fading from our rearview mirror, we’re left having learned some hard lessons. However, are you prepared for a less dramatic, yet considerable significant personal economic downturn? How can you protect your small business from even the slightest of economic hiccups? Here are a few precautionary and proactive measures to consider for your business to wade through any troubled economic period.
Do your budget now
A self-audit is a necessary evil to trim the fat on your business expenses. Review your current services and subscriptions, then ask yourself, “Do we really use these services today?” The relevance of these items may have been pertinent at one time, but over time, their usefulness can come into question. Use the times of service-subscription renewal to renegotiate the terms. Be sure to make positive cash flow a priority instead of growth in times of a downturned economy.
Customer service becomes key
Focus on that thing that makes your business unique — the people. If your customers remain loyal due to the fact that your business has outstanding customer service, they will be less likely to leave. Especially in a downturn, you want your customers to be able to lean on you for the services you provide. So start now and firmly plant yourself in your customers’ good graces. When things go sideways, your business will be one of the last to lose, if at all.
Diversify your base
Expand into new markets. This doesn’t mean that your product has to change. Partner with other companies, so in times of a downturn, you scratch their backs and they scratch yours. Maybe you can provide in-house videos, or plug into the latest social media trends. In today’s multi-platform economy, diversifying can mean so many different things.READ MORE: Inaugural Penn Relays 5K Underway At Penn Park
Poach customers from your competitors
Your market partnership and your customer service can help bring in new loyal customers. Now could be the time to run sales or initiate a discount program to get your foot in the door with new audiences. While you’re at it, roll out loyalty programs for both new and existing customers. Make it sexy to be part of your client base. You’re new to your target audience, a hot commodity perhaps, so entice them with a valuable offer to get a hold on them.
Take money even if you don’t need it
Start that rainy day fund with lines of credit, loans and by getting cash from investors who want to see you succeed. Hoard that cash, and don’t touch it. You’ll never know when you may need it. You’ll save time, money and maybe more than a few headaches when you will need it the most.
This starter list sets the table for you to think about solid steps you can take to ward off an economic downturn. The goal is to create overall stability in your cash flow and reserves by staying ahead of the curve, regardless of any curves the road may throw at you.
This article was written by Christopher Millard for Small Business Pulse