Skilled Migrant Professionals December 2015 | Page 19
Business
When Times
Are TOUGH
Five business strategies to get you
up when the economy is down
E
very few years, the business cycle turns down and things get
tough. For good business people this is a sign to get going, because with competitors struggling, it is a great time to build your
business. There are two key areas you need to focus on; your survival
and your growth. This paper outlines just five things you must do to
make the best out of general business downturn. Follow the suggestions made, and you will not only survive, you will prosper.
1. Cash Flow
Cash is the life blood of every business. You need to get as
much cash as you can into the business and protect it once
you have it.
• Where do you have cash stored? It may be with your
customers who are slow in paying you. It may be in
overheads that you don’t need. It may be in assets
that you don’t really need to own.
• If you had to get some money within 30 days,
how much could you get if you really put all your
effort into it?
• Look at the cash going out of your business. Can
you stop spending in any areas? Can you slow
down the speed in which it is spent?
2. Retain Your People
In most businesses that employ people, they have
one-third of their staff that they are lucky to have,
one-third that they would do be better without, and
the remaining third are somewhere in between. In
tough times you must protect your best people (you
may need to let go of the one-third who you could do
better without).
• How can you make sure you keep the ones you
need?
• Do they have contracts?
• Do you reward them?
• Do you tell them how much you appreciate their
efforts?
• Is working with you fun?
3. Retain Your Customers
Keeping your best customers is much like keeping
your best employees. Work out who the top two
thirds are and spend time on them.
• Find out what problems they are having and what you can do to help them.
• Keep in close contact with them.
• Thank them for their business; ask if they can give more business.
• Do they have any friends who they can refer you to?
• Are you linking your best people with your best customers?
• How can you help your customer increase their business?
4. Improve Your Profit
Cash and profit are closely related. Around 20-30 per cent of your operational expenses are due to waste in your business. You could remove
that waste and the savings become instant profit (and probably cash).
• Can you reduce your overheads? What about your people and material costs?
• If by law you had to double your profit within three months what
would you do? Why not just do it anyway?
• Do you really know what profit you make each year? What about each
month? What about each day?
• Where do you make your profit? Did you know that 20 per cent of
your customers, and 20 per cent of your products (and services) generates 80 per cent of your profit? Why not just focus on these customers
and products for the next six months?
5. Maintain Your Energy
When you are energised, your business is energised. You must develop
and guard your energy levels.
• Are you fit?
• Do you love what you do?
• Are the people you work with fun to be with or
are they energy vampires?
• Do you work too hard?
• Do you make time for yourself?
When you are energised
your business is
energised. You must
develop and guard
your energy levels
Time management is the biggest thing to address
in tough times. Twenty per cent of what you do generates 80 per cent of the benefit you are to your business
(and family), so what are you doing for the rest of the
time? Maybe, if you stop doing some of the low-value
stuff, you will boost your energy levels.
Getting your business under control is critical in tough
times. There is no point in growing a business that does
not have good cash flow, profit or leadership. Get these five
things largely right and your business will grow. Every leader
and every business is different, so you need to decide where to
start. All five strategies are equally important and the need for
discipline and accountability for them lies with everyone – the
responsibility is yours, it is up to you to make it happen.
By Andrew Cooke,
Growth & Profit Solutions
December 2015 | www.smpmagazine.com.au
19