The Great Depression of the 1930s has shown that an economic downturn can happen seemingly at the drop of a hat; the COVID-19 emergency is showing that it can happen with a sneeze.
Economic declines can happen for various reasons. They can be industry or service related or seasonal. When they do happen, as a business owner, you need to evaluate your current operations and determine how you can emerge as strongly as possible.
Software – There are several things to consider. The first is whether or not your current software is working for you or not. There are a number of products available on the market and it is possible that you may not need some of the features you are paying for, or may need others. It would be wise to shop around to see what is new and of benefit to you at the price you can afford. Some systems are more integrated than others and some incorporate cloud storage and retrieval. With more remote workers, it may be time to invest in additional software like collaborative software and video conferencing.
Rent and Utilities – Again, with a remote workforce you are probably realizing how much can actually be accomplished without personal contact. Giving your physical space some consideration, especially in the area of retailing, you may be able to find more affordable accommodations, negotiate better rates for your current space, or think about alternatives. Along with this goes utility usage. Check out competitors in the utility arena and see if you can negotiate better rates, or at least an initial discount for changing services.
Marketing – This may be an opportune time to reflect and analyze just how effective your marketing strategy and campaigns are. Looking at what worked and what was less effective, you will be in better shape to move forward when things settle down. Looking a what generated the most revenue and what generated the most profit (these can be two different areas), should give you an idea where to focus your efforts. There are a number of tools available, like Google Business, to help you understand where your leads are coming from and how many were converted to sales. It could be a good time to take a look at your website and see if it needs a fresh perspective.
Outsourcing – This is a time to consider whether you want to continue some functions (accounting, payroll, etc.) in house or to look at outsourcing. If you are currently farming some work out to other companies or individuals, you can certainly price shop and possibly negotiate more service for less money.
Diversification – Put your downtime toward productive strategizing. Look for areas in which you can diversify. That includes looking toward new markets and customers or to new products or services.
Difficult times are particularly hard on the small business owner. This can be an opportunity to reflect on current operations and explore changes for the near and future times.
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- The Capex Team