Growing Your Business in Difficult Economic Times

Cut costs, improve productivity, and actually GROW your business while your competition is operating in survival mode.

Whether you view the current situation in the global marketplace as a depression, a recession, or simply an economic crisis; no one can argue that there aren’t several important indicators of a worldwide economic downturn.

These include high oil prices, which contribute to both high food prices and a declining dollar value; a sub-prime mortgage crisis; increasing unemployment; the collapse of Bear Stearns and Lehman Brothers; a substantial credit shortage leading to the bankruptcy of several large and well established investment banks and an intervention totalling HUNDREDS of BILLIONS that has yet to slow plunging stock values or stabilize a faltering real estate market.

Each and every one of us has begun to feel the effects – in our neighborhoods, at the grocery store, in the job market…

What does all of this mean for your business? Should you let employees go? Put a freeze on hiring? Cut back on marketing? Backburner plans to explore new markets?

Trimming fat from your business is smart in lean times; but there is a danger of entering a downward spiral which leads to going out of business. When revenues are low you cut back on marketing – which brings less clients, which in turn decreases revenue further – leading to more cutbacks. A few cycles of this and you’ll be out of business.

It is only natural to revisit your overall business strategy when market conditions change, but it is important to recognize that slow economical conditions may offer a significant opportunity to improve your business model.

Today’s uncertain economic times are forcing all executives, managers, and business owners to adopt new strategies for navigating through the current business downturn. At times like these many companies prefer to move into a survival strategy to ride out the storm. Survival strategy, while conservative, has one underlying problem: in today’s hyper-connected economy things can unravel quickly, and when your business is not growing and improving it is falling behind and headed for extinction. Keep in mind that even though your business may be slow today, your business will return to profitability in the future, IF you do what is necessary to survive today.

~ Rick Erling, President of The CxO Group a Business Coaching and Performance Improvement firm

This may be the best time to implement new strategies and services which leverage existing technology to cut costs and improve the efficiency and effectiveness of how and where you work. Implementing distributed teams and developing your virtual teamwork can have a profound effect on your bottom line. Cut back on the things that cost your business the most money: office space (real estate), uncessesary travel, and employee turnover and training.

The truth is that there are always those who lose sight of their long-term strategy. It’s important to remember that no matter what state the economy is in, there are always growth opportunities for those who stay focused. In fact, a down economy can present new opportunities precisely because your competitors tend to focus inward, become defensive, and sometimes fail to act altogether.

Rather than halting growth and only focusing inwardly, you can find new ways to streamline your business by collaborating with your customers and partners. This may involve investing in new technology. And if that new technology supports your strategy, you will find that the return on investment will be relatively fast and favorable.

It’s understandable to want to adopt defensive tactics during hard economic times. In fact, it’s so understandable that most of your competitors will do just that. This gives you a chance to leap ahead. Even by keeping your normal pace of business, you can ease past the competition–because they will most likely be moving slower or standing still. You need to grow to thrive as a business, and a down economy should not alter your long-term strategy.

You should never lose sight of the unique value that you bring to business relationships. If we could have our choice, I’m sure we’d all prefer an upbeat market but that’s not the reality. Just don’t forget that the reality of a down economy includes real opportunities for growth.

~ Preben Damgaard, Vice President, European Middle East and Africa (EMEA) Operations for Microsoft Business Solutions

Meeting these new challenges head on can actually gain you an edge over your competition. Examine your work process and work style to discover ways to take advantage of virtual teamwork, effective remote collaboration, and virtual offices. You can save money AND make your organization more flexible and effective.

You may not have control over the economy but you DO have control over your response to the economy. You can choose to see it as an opportunity to take a hard look at some ways that you have been wasting time, money, and resources.