The financial outlook over the past three years has not been promising. It has been officially acknowledged by both American and European financial authorities that the economy is in a recession. Most all financial experts have been adamant in their claims that in this period of economic decline and that starting or expanding a business is not recommended.
Many internet businesses have faced a great deal of hardship despite their hard work and efforts, but submitting to the general fanfare of panic and fear in these hard times is not going to help matters. It is typical in times of recession for the government to lend a hand toward helping struggling business owners and entrepreneurs because their survival strengthens the condition of the economy. When the going gets tough, the tough must get going, so here are 10 survival tips and strategies for keeping your business “in the green” and profitable during the tough recessionary times:
1 – Cash – The Great Negotiator
Sometimes commodity prices decrease during times of economic distress, but not always. The current recession has delivered historically high fuel prices and grocery bills. When credit gets scarce as lenders tighten their purse strings, cash becomes the great negotiator. Smart and savvy consumers can bargain substantial discounts, especially for large purchases such as computers, business supplies, and specialized services. When times get hard, consumers cut their spending, making businesses more eager to offer savings in order to make sales, especially to cash buyers.
2 – Advertising Efforts – Position Your Business for the Future
Be careful where you slash your business budget. Some internet business owners completely cease their advertising efforts to save a mere few dollars on their spending. This is a prime opportunity to position your company for future expansion and growth by doing just the opposite. As your competitors decrease or eliminate their advertising efforts in hard times, seize the opportunity to take the lead in the marketplace by using low cost but high outreach advertising campaigns. Research and test your marketing dollars spent and what you are receiving as a return on that investment.
3 – Take Advantage of Free Marketing Strategies
There are several low budget and free ways to market your products and/or services, including the ever popular and rapidly growing social media websites as well as email marketing, article publishing, and other online public relations efforts. Adding new content on and off of your website is a cheap yet effective way to market your business. You simply write or outsource for topic related content, offer some usable advice or information for free, and publish the articles both on and off site. Continuing to promote a business in a recession is a top proven way to increase your market share, and what better way to do that than utilizing free marketing methods?
4 – Value, Protect, and Keep Your Customer Base
It is essential in any business to keep clients satisfied so they’ll want to bring you repeat business, even if it sometimes cuts into your profits. It is important during times of economic difficulty to keep prices as low as possible, even as your costs go up. After the 911 tragedy that caused a severe air carrier crisis, some airlines survived because they realized they must reduce their prices in order to stay in business. By making good will efforts to offer discounts and savings wherever and whenever possible, you not only protect your existing client base but attract new customers at the same time. In addition to whatever discounts you can offer your clients, give them payment alternatives that help them work within their budgets, and offer promos and coupons for their continued loyalty. Valuing and protecting your customer base is something that will repay you throughout the years many times over.
5 – Cut Overhead and Liquidate Unnecessary Assets
In order to survive during hard times, you have to be creative about spending and cash flow. You must utilize every available resource you have that is paid for, and eliminate unnecessary expenses. You must also liquidate assets that you can do without. Executive spending must be reduced, benefits may have to be cut, staff or personal salaries may have to decrease. Salaried staff may have to be replaced with outsourced subcontractors; unused equipment may need to be sold; unused office and/or warehouse space may need to be leased out to other businesses; the company may need to relocate to less expensive premises. Many perks and bonuses may have to be eliminated.
6 – Be Selective About Terms and Clients
During hard times, you may find it necessary to weed out customers who pay late and don’t abide by the agreed upon terms. It is easier during profitable times to allow some leniency on this, but when cash is tight, you can’t carry a customer’s “note” longer than your terms allow. When you have to cut back on resources, you no longer have time or the staff to allocate to hounding these slow paying clients to receive payments.
7 – Get Joint Venture Savvy
Profitable joint venture situations offer solutions whereby you can find a business with a large client base full of customers that fit into your target market; by working together you can both reap profits from the union. Seek venture partners you are not in direct competition with and come up with ways both companies can contribute to the mutual benefit of both.
8 – Keep the Talk and Atmosphere Upbeat
When times get bad, talking about them incessantly only seems to make them worse. Recessions scare and depress people, and they worry about the safety and security of their future. Being aware of the situation is one thing, but dwelling on the negative doesn’t do much to help. Focus on the positives and promote an atmosphere receptive to new ideas and innovations that contribute to the survival and benefit of the business. Being constructive and open to new ideas is important.
9 – Utilize Team Member Resources
Entrepreneurs often feel very alone during difficult times and begin to question their abilities. Things are usually not as troublesome as they may seem, but worry and stress can cause your mind to tell you otherwise. Making all the decisions alone is not always best. Surround yourself with a trusted team of advisers, friends, and mentors, and bounce problems and questions off them. You might be surprised at the outcome when you pool great minds together.
10 – Make the Right Choices – Don’t Worry Be Happy
Concern for your business is essential; worry can be detrimental. The world of economics is similar to the weather in that while you cannot change it, you can make the best attempts to prepare for it. No matter how much you worry as to the outcome of your business in unsure times, it won’t change anything. Your energies are better focused on how to deal with the way things are, not on trying to change things you cannot. Stay positive and those around you will do the same, which is best for business. Smile, laugh, tell a joke, ease the tension, and your employees, clients, and associates will pick up on the good vibes.
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Author:- Alex Papa is a serial internet entrepreneur. In his new website you will find a business start-up course designed for people who wish to start a new business in 2011. In one of his blogs Alex writes about antivirus solutions where you will find the latest Norton promo codes.