In a state of mass economic turmoil it’s crucial for your business to live by these three primary rules. And, by doing so, even at the very worst of times, your business will prosper.
1. Keep Overhead Costs Down:
Minimize overhead expenses everywhere you can. You’ll be surprised by how good it feels to “tighten the belts” and how quickly you and your staff become accustomed to working with less and in the long run understanding that “Less equals More”.
One of the largest expenses for most businesses is leased space. In this economy, many landlords are quite willing to renegotiate and make amendments to existing leases, especially if you’ve been a good paying tenant in the past. After all “a bird in hand is better than two in the bush”.
It’s not uncommon for a Landlord to let you pay only the additional rent portion for a 6 month period and add the base rent portion to the back end of your lease, or quite possibly lower the base rental rate for the next year or two by extending the term.
If you’re uncomfortable approaching your landlord, there are reputable tenant representatives who, for a very reasonable fee, and on a “pay per performance” basis, can either assist you with renegotiating your lease or they’ll do it for you. Obviously, the latter is at a higher fee, but in many cases, worth every penny if you have a difficult Landlord.
Remain flexible
If your lease is about to or has already expired and you need to find an alternative place to conduct business, in this economy it’s best to first consider subleasing (lease takeover) or any other short term options like sharing space with a strategic partner. Or, if you’re searching specifically for office space, consider executive office suites with all amenities and services included. This approach will keep you flexible with a quick early out.
Other areas to quickly reduce overhead costs could include renegotiating the lease or rental contract you have in place on your photocopier, computer systems, or heavy equipment like forklifts or special machinery, and quite possibly your cellular phone contracts. You can also approach your credit card companies and negotiate a reduced interest rate in order to keep the outstanding balance payments low.
On the other hand
If you find that you no longer have a need for your business space, equipment, machinery, or even a vehicle of any kind, a great option is to place an online ad to either have someone take over your lease or buy it outright. At LeaseArrangers.com you can post your own FREE ads related to items available and wanted for lease, lease takeover, sale, and rent.
Most leases are easily transferable, however, there may be a processing fee attached. It’s always best to check first with your lessor on the transferring details. Alternatively, if you find yourself in the market for additional equipment in order to capitalize on your competitor’s lack of performance, or you see a growth opportunity that you can’t pass up, you should consider taking over a lease yourself or leasing a used item rather than going with new.
Some leasing agents and companies have repossessed or off-lease inventory listed on their site or you can find a wide range of items available on FREE to self post sites like LeaseArrangers.com. And, you can even get a FREE lease quote from them on most items posted for sale over $5,000. The rule of thumb is; if it’s over $5k and can be registered on title, it can be leased.
2. Be Customer Selective:
By listing your current customer base; determine who's profitable, and who's not. If some are draining your resources, either raise their prices or get rid of them. Just like low to mediocre performing employees, you can't afford to carry unprofitable customers. The primary objective is to be lean and mean without sacrificing the quality or level of service everyone knows you provide.
This approach will force you to identify your ideal customer and to be much more selective of whom you want to do business with. Remember, your customer pool is always where your busy competitors market their products or services.
Unfortunately, in any tense economy it’s not a simple task to attract and secure new customers. Why?
The internet has made it far too easy for your new and existing customers to find your competitors. Although there’s more than enough room for everyone, you need to take a close look at how your products or services can be seen before your competitors, and directly in front of your target market!
Keep marketing
For many businesses, next to the leased space and employee salaries, advertising and marketing is the next biggest expense. When the economy weakens, the knee-jerk reaction is to do the exact worst thing - slash and try to go forward with very little or without altogether.
However, numerous studies have shown that companies who maintain (or better yet, accelerate) marketing activity in weak economic times reap the rewards in droves for the long term.
Statistically, a potential customer needs to actually see your brand a minimum of 7 times before you stand a chance of them becoming your customer. Can you really count on one person going back to your website 7 times? Not likely, but if they keep ending up on your site because they were on another site then I would venture to say 7 times will go by quickly.
If you have a specific product or product line you’re selling, the first thing you need to do is find a FREE (to post) site other than your own to put each of these products on display (preferably in different relevant categories).
Also, web feeds today can take a product for sale on your site and make it an ad on “their site” – a great example of this is LeaseArrangers.com. As they in turn promote their site to their various target markets, your products are found again and again by your potential customers.
And, if you don’t presently have your product items displayed on your website, LeaseArrangers.com is a place where after you post 10 or more items, they can transfer these ads to appear syndicated on your site under a linked “Our Product Inventory” heading that looks like it was always meant to be there.
Promote wisely
A very wise and cost effective approach to market your business products and services is to find a good website graphics student to create a series of electronic flash & still banners that promote your company, and then pay a small monthly fee to strategically place them in key category positions on various classified sites.
Banner ads that link back to your website, or directly to your product or service demo video can be a very smart and inexpensive way of promoting your company. Especially, if placed on “Next Generation” up and coming niche market websites where they offer a variety of local to national exposure positioning options.
When it comes to the big guns like MSN or Yahoo, unless you’re a fortune 100 to 500 company looking for some added brand exposure, the cost of placement and positioning on these sites will unlikely make financial sense.
Nonetheless, get pricing from numerous sites even if you think you can’t afford it. Use social networking sites like Twitter, Facebook, mySpace, LinkedIn etc. for back linking to your business blog. Make a video about your product or service with your webcam and put it on YouTube linking back to your website. Use your local board of trade or chamber of commerce to get your message out. Attend networking events and don’t be shy to promote yourself behind your brand!
Regardless of the economic times, don’t be afraid to ask your current advertising suppliers for better pricing or longer terms. And, despite what your advertising and marketing budgets may be, you need to maintain good existing customers and attract and secure an abundance of new ones.
3. Continuously Improve:
Ask any successful business owner what their secret is and they’re likely to tell you “hard work and dedication”. Very true, however, this is tied directly to their commitment to continuously improve their business model and quickly adapt to change whenever necessary.
Ultimately, at all times every business leader needs to get the most from their work force, and openly communicating and planning every goal and objective with them is the key to a successful business.
That being said, instilling realistic performance measures and linking everyone’s compensation increases to the company’s achievements will drive a team approach that ensures the company will be agile enough to manoeuvre through the tides…smoothly!
Think creatively
Remember, salaries and wages are the single largest expense for most small businesses and during recessionary times there are many talented people looking for work.
If you've been muddling along with non team oriented employees, take note that they're likely dragging your business down, or at the very least, restricting it from improving and getting better. If you can't quickly bring their performance level up to where it needs to be, do the difficult thing and make some drastic changes. In this economy, there’s at least five others with an equal or better skill set waiting to take their position…tomorrow morning!
Constantly be attentive and on watch for fresh ideas and opportunities. Stay abreast of all press releases, news and trends related to your business industry and activities. Interact with a wide variety of entrepreneurs to get a clear picture of what they're doing. Learn from what's going on around you, and be poised to jump on good strategic opportunities when they come your way.
When the going gets tough, keen success driven business leaders really get going. Always be prepared to make changes in a proactive frame of mind. Your business can not only survive the recession, but also gain from it, provided however, you live by these fundamentals.
This article was written by LeaseArrangers.com, a FREE to post classified ad site for B2B, B2C, and C2C buyers and sellers of big ticket items like Equipment, Real Estate, Transportation and more. Lease – Rent - Buy - Sell
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Good tips for any economy. I'm getting on the phone now. TJ
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