Small Business Resource

The recession may be officially over, but that doesn’t mean times aren’t hard for businesses. With the latest GDP figures from the Office for National Statistics showing a decline of 0.5 per cent, there is a possibility that the economy can still double dip. So how can a business survive during these difficult economic times?

One thing that can be tempting is to adopt an ‘ostrich mentality’ and bury your head in the sand, but that can actually be counterproductive. Instead, businesses need to focus on what they do best and look at ways to make sure they are in the best possible position to weather the storm.

One of the first things to do is to take a good look at the business. It may seem obvious, but business owners need to take a good hard look at their operating structure and see how they can improve on what they do. This includes looking at cost cutting measures. As hard as it may be to do, it’s vital that there are no unnecessary costs. If you can find a cheaper energy supplier or change the way you do things to make sure the business runs efficiently, it is all going to help in the long run.

However, one mistake that businesses often make is to cut costs too much. If it is going to affect the service you offer by making a cut then it’s not worth doing – so while it is important to watch the pennies, don’t make savings just for the sake of it. Think about everything you spend and cut costs where you can, so negotiate with suppliers and so on, but don’t cut back on the business itself. In price-driven times consumers are incredibly discerning, and after all, it is a competitive market – so if your service or product doesn’t cut it in the marketplace it is not going to survive.

Another important tip is to always focus on your customer. According to Stelios Haji-Ioannou, head of the easyGroup, writing in the New Statesman “if you offer a product of acceptable quality at a good price, consumers will buy it”. So it is vital to focus on your customer, and hence often a case of having to ‘speculate to accumulate’.During a recession customer relationship management (CRM) software can be a real investment for a company.  Your customer base is even more important than ever, and CRM software allows you not only to keep the customers you already have happy, but also to get new ones, as it can help you refine your marketing strategy.

Brand loyalty goes out of the window when times are tough, so you have to make sure your customers are happy, and this is where CRM comes in, as it helps you understand your customer base. One of the main benefits of the software is that it collects and organises information about your customers, so you keep them happy by making sure you are fulfilling all the promises you have made to them. You also work out the best ways to ensure they keeping coming back and spending money.  Moving forward, you can also target the right sales opportunities to the right customers, as CRM keeps an accurate record of every interaction a customer has with a company; you can build a profile of their likes and dislikes and target them accordingly.

There is no ‘one size fits all’ golden rule to surviving a recession, but as long as you are running as efficiently as possible and focusing on your customers, you should come out the other end. In fact, some economists think of recessions in almost Darwinian terms, as they weed out the weakest companies. As long as your company is strong enough to survive once the recession is over, you’ll be in a much better position.

This article was written by Workbooks, leading supplier of web-based CRM systems.

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