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In times like these, small business are under tremendous financial pressure. Finding Credit is a nightmare, large companies are taking longer to pay their bills and the cost of fuel is having a massive impact on the profits.
But small business owners will not go down without a fight, we have all had to work very hard to get to where we are now, and we won’t give up to the credit crunch without a fight.
The government has always encouraged us to grow our businesses as big and fast as we can, and obviously to do so we use money in the form of over drafts or loans from the banks. The bank mangers are now in a very tricky position, they still have achieve their monthly targets to achieve, but are thawrted by not being able to lend us the money we need. All businesses, large and small are finding it hard to renew overdrafts, and this isn’t simply something that affects the traditional retail businesses usually hit during a recession, but also the business usually “untouched” by hard trading times such as accountants, solicitors and even GP Practices.
However, its not all gloomy news. According to the Federation of Small Businesses (FSB), entrepreneurs and small business owners are proving resilient in the face of tough economic conditions, are even finding new ways to turn a profit, despite a shrinking credit market.
If you haven’t already started thinking about how you will get though this credit crunch then its time you did, this isn’t a time to be burying your head in the sand. So here are five very helpful tips that may help you.
- If not already, then join the Federation of Small Business (FSB), as a small business this is the organisation that speaks out for you, lobbying and publicising. In times such as this, with the banks screaming for billions of pounds, small businesses need to stick together and shot together so that they have a voice that can be heard. Additionally, member benefits such as protections from employment tribunals and legal advice regarding collection of money from customers can give you peace of mind against unexpected bills and stressful situations which in times such as this may hit your business harder than normal. The cost of being a member starts at £100 a year, most of which many business can recouperate in the first year from saving on member discounts with credit card processing alone.
- Keep a close eye on you cash flow, get your invoices out as soon as you can and if you are delivering goods direct to your customers offer a little extra discount for COD. The companies that take a long time to pay their bills can be a real pain, and chasing them for overdue money can be soul destroying. Some of these companies may be large, high profile companies, but you have to ask yourself are they really worth the time and heartache, and more importantly is there a worthwhile profit at the end of it, after you have taken into account the cost of the sometimes 90days credit that have taken from you. Some times its better to let someone else have the grief. We also recommend that you always do a credit check on all new customers and agreeing clear credit terms up front, even perhaps taking a deposit, it could cost you a lot of money or your business if you don’t.
- The costs of running a business today is very high, so you need to look at where you can make savings in every part of your business. But before you start sit down with the last years accounts, go though them work out what has become more expensive and how to reduce your overheads. Remember not to cut the quality of your product or service unless you are doing this as part of a change in strategy, and changing your marketing and pricing. You may consider moving to a smaller premises or subletting some of your existing space. If you are considering redundancies make sure that you do it the legal way, remember if your a member of the FSB they will help advice you. Combine trips, meetings etc, make weekly chart for the office for all your deliveries etc, so that you and your staff make necessary journey only, its all about saving fuel and time. And finally take a look at your fixed costs. Many businesses don’t regulary review this because after all fixed is fixed. However, in times like these it’s sometimes useful to go back to that blank piece and paper and work from nothing upwards. What do you really need in order to carry out your business today? Just because something has always been done in a particular manner it doesn’t mean that that you need to keep doing it that way. Times such as these are good opportunities to look at your business from a different perspective.
- Focus on keeping your customers. When Finances are uncertain, consumers cut unnecesserey spending. So do all you can to keep your customers coming through the door. Small discounts, loyalty schemes and regular communication are just three ways of letting your customers know you value them. Customer service is very important, they appreciate suppliers that give that extra service for their money, especially when times are hard. Good service, fast delivery and flexible payment terms can help persuade people to spend with you rather than a competitor. Just go that extra mile.
- Marketing your business can be a real nightmare, there is the risk that your full page advert in the local paper just becomes lost in a paper full of other full page adverts all screaming out “special offer”. It’s time to think about new and novel ways of advertising, and the best thing is that “novel” needn’t always be expensive. For example In-game product placement is becoming a one of the fast growing forms of advertising, game players spend traditionally twice as long on the internet as any other user, and adverts get twice the average branding and exposure per advert. Also gamers are a very chatty and connected group of people, and word of mouth and recommendations are always the best form of advertising. After all, what could be better than using in-game product placement to advertise your business, pitching it in exactly the right context. Because this is such a new and exciting form of marketing, rates can be cheap and deals can be found,
If anyone is interested in opportunities for their business in in-game marketing then contact us at Fantasy Couriers and we can discuss how we can put together the best possible package for your business.
