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Business advice from Abe Helou, continued ...
Another
way to deal with a recession is to increase marketing efforts without
increasing the marketing budget. Therefore, business owners should
concentrate their marketing efforts on activities that have a proven
track record in attracting customers. Similarly, providing excellent
customer service aids in customer retention, which is far cheaper than
the cost of generating new customers. Business owners should also try
to understand and accommodate their customers’ economic realities as
much as possible through strategies such as altering product lines or
substituting some brand-name items with generic ones. Finally, owners
should utilize their existing customer base for referrals.
Owners
should continue with their sound business practices. Paying attention
to current and projected cash flows, as well as collecting receivables
while building safety cash reserves, will help any business weather
difficult economic times. It will also position the enterprise to
benefit from any unexpected economic recovery. The separation between
the owner’s income and expenses and those of the business must be
maintained at all times, as many small businesses fail due to a lack of
this separation. Similarly, maintaining and strengthening internal
control systems should reduce waste and help eliminate the unnecessary
duplication of efforts. When cutting expenses, the quality of customer
service should not be impacted, even if it means putting in the kind of
hours that were required when the business started. Finally, slashing
prices to attract customers will only create a price war between
competitors; as a result, the level of sales will remain the same but
with a reduced profit margin. In other words, competing on the basis of
providing the best value for customers is not the same as competing on
price.
Sustaining an enterprise through an economic
downturn, or growing it during a robust economy, requires understanding
and utilizing one’s assets and continuing best business practices while
identifying and seizing opportunities.
Andrew J. Policano | Anil Puri | Esmael Adibi
Abe Helou | Linda A. Livingstone | Timothy Peters
Ahmad Hosseini | James G. Ellis
BACK TO MAIN PAGE
Business advice from Abe Helou, continued ...
Another way to deal with a recession is to increase marketing efforts without increasing the marketing budget. Therefore, business owners should concentrate their marketing efforts on activities that have a proven track record in attracting customers. Similarly, providing excellent customer service aids in customer retention, which is far cheaper than the cost of generating new customers. Business owners should also try to understand and accommodate their customers’ economic realities as much as possible through strategies such as altering product lines or substituting some brand-name items with generic ones. Finally, owners should utilize their existing customer base for referrals.
Owners should continue with their sound business practices. Paying attention to current and projected cash flows, as well as collecting receivables while building safety cash reserves, will help any business weather difficult economic times. It will also position the enterprise to benefit from any unexpected economic recovery. The separation between the owner’s income and expenses and those of the business must be maintained at all times, as many small businesses fail due to a lack of this separation. Similarly, maintaining and strengthening internal control systems should reduce waste and help eliminate the unnecessary duplication of efforts. When cutting expenses, the quality of customer service should not be impacted, even if it means putting in the kind of hours that were required when the business started. Finally, slashing prices to attract customers will only create a price war between competitors; as a result, the level of sales will remain the same but with a reduced profit margin. In other words, competing on the basis of providing the best value for customers is not the same as competing on price.
Sustaining an enterprise through an economic downturn, or growing it during a robust economy, requires understanding and utilizing one’s assets and continuing best business practices while identifying and seizing opportunities.
Andrew J. Policano | Anil Puri | Esmael Adibi
Abe Helou | Linda A. Livingstone | Timothy Peters
Ahmad Hosseini | James G. Ellis
BACK TO MAIN PAGE
Abe Helou | Linda A. Livingstone | Timothy Peters
Ahmad Hosseini | James G. Ellis
BACK TO MAIN PAGE
