FEATURE
FEATURE
An Economic
Downturn
Survival Kit:
How To Keep Your SME Afl oat
BY THE NATIONAL SMALL BUSINESS CHAMBER (NSBC)
WITH THE ROUGH STORMS OF THE ECONOMY WE FIND OURSELVES IN, IT IS TIME TO
GET PREPARED. THE KEY TO SURVIVING AN ECONOMIC DOWNTURN IS PREPARATION.
IF YOU DON’T HAVE A SURVIVAL PLAN IN PLACE YOU MAY NOT REMAIN AFLOAT
DURING BAD ECONOMIC TIMES. HERE ARE SEVEN ITEMS TO CONSIDER FOR YOUR
ECONOMIC DOWNTURN SURVIVAL KIT.
1. Limit Expenses
Go through your expenses and cancel all those which are not necessary to
run your business successfully. If the process does not directly contribute to
the making of the product or service, then the chances are you don’t need it.
Bonuses and incentives may be needed to be put on hold until the economy
turns around.
2. Keep Your Marketing Budget
The fi rst place where people cut on their budgets when the economy becomes
bad is their marketing but this is a bad idea. How will your customers know
where you are and how will you fi nd new customers? It is important to create
awareness about your product and service. Furthermore, it will be a good idea
to look into low-cost marketing ideas like social media and word-of-mouth.
These marketing plans cost very little to nothing to implement.
3. Preserve Great Customer Service
Your customers are key to surviving an economic downturn. You need to focus
on your current customers and keep them happy. If they know you will be with
them during the bad times, then they will be there during your good times.
Make sure that your customers pay you on time. Ensure that your after-sales
service is excellent. By ensuring you offer quality to your customer at this time
and during your good times your clients will keep coming back. Remember your
customer is king when it comes to business.
4. Watch Your Cash Flow Like A Hawk
As has been said many times, cash fl ow is the lifeblood of a small business.
If you don’t have a good infl ow and outfl ow of cash your business may not
survive. In this event, it is important that your customers pay you on time and it
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is important that you limit how much cash you are spending and what you are
spending your cash on.
5. Cross-Train Your Staff
It is important to have well-trained staff so that they are able to make accurate
decisions based on their knowledge. Teach them about your processes and your
products. If the staff member is interested in other aspects of your business
train them in that fi eld. You never know when you may need them to do a bit
more during tough times.
6. Lead By Example
If you make a change on how you pay your staff or the hours you want them to
work then you need to apply those rules to yourself fi rst. You can’t expect your
staff to respect you and support you if you don’t lead by example. They will
resent you if they suffer and they perceive that you don’t.
7. Diversify Your Offering
Check your product and what your competitors are doing in your industry and
then see where the opportunities are and how you can fi ll them. By diversifying
your offering, you will be able to tap into a new market and spread your risk
among a group of customers. If you are a physical shop, you could consider
going online.
By having these seven considerations in your survival kit, you will be well-
prepared to weather the economic storm when it hits.
NSBC
www.nsbc.org.za
www.AfricaPrint.com