Time to start thinking about growth again
It’s been tough for nearly all businesses over the last year or so, and despite economic indicators pointing in the direction of recovery many are still wary of the threat of a “double-dip” recession and are bunkered down in survival mode.
That’s perfectly understandable, as the economic downturn we’ve just experienced was as bad as many can remember, but having survived this is exactly the time to start thinking ahead as to how you’re going to thrive in the new economic order.
Because, make no mistake about it, the business landscape has changed and there’s opportunities out there for those willing to find them.
Of course, the underlying principles to growing your business remain whatever the economic outlook:
1. You’ve got to have a strategy: Failing to plan is planning to fail. Things are less clear during difficult market conditions, so it’s vital you know where you want your business to go in order that you can take the necessary actions to get you there. Successful strategy balances tough decisions about your cost base and investment plans while preserving the opportunity to pursue profitable opportunities.
2. Cash is king: Keep your business plan up to date and in particular you’ve got to manage short-term cashflow meticulously. The reasons most businesses fail is not down to poor sales or a bad product, but because they run out of cash. Growth has to be underpinned by a healthy financial position.
3. Control your cost base: You will have trimmed costs wherever possible to survive the downturn, so don’t allow them to creep out of control again as you move forward. Keep an eye on overheads, monitor suppliers performance and don’t pursue unprofitable product lines.
4. Spot the opportunities: Refresh your product/service. See if you can earn more from existing sales. Look for new markets or alternative sales channels. Build new relationships. Customers’ needs will have changed and there will be opportunities to pick up new businesses where their existing suppliers have failed.
There’s no doubt the current business environment is challenging, but the opportunities for growth are exciting.
Graham Wilson, corporate partner, Beever and Struthers.