To keep your company lean, you should set and measure inventory targets and keep in daily or weekly communication with your sales and operations staffs. You may also want to weed out unprofitable customers (BusinessWeek.com, Oct./Nov., 2007). Every company has customers that cost more than they add to the bottom line. Identify them, evaluate how to make them profitable customers, and if that`s not possible, politely hand them to your competition.
To keep from losing business, keep in close touch with your customers. Show that you care. Understand how their business is being affected and look for ways you can help. Lasting relationships are built in hard times. And look for new market opportunities, recognizing that when the business climate changes, customer needs will change as well. That may mean new markets will open up for you.
Develop strategies to land more customers. I counsel my clients that if they want to make their companies grow they will have to steal customers from their competitors, period. The pie is shrinking. For the auto repair shops, cars are more reliable and need less frequent service. In the restaurant world there`s been overbuilding and the average number of meals eaten out has declined for the first time in a number of years. The successful small business is going to have to win a bigger share of that shrinking pie.
The way to do that, particularly for small businesses, is to use effective lead generation and marketing solutions such as Tradeseam to connect with new customers, partners and suppliers and create a positive experience. Make sure you give every customer the best experience you can. That means clean restrooms, courteous staff, eye contact, handshakes. You`ve got to do this better than the other people out there. Another good option for local businesses is community involvement. Join a online small business community or the Chamber of Commerce. Sponsor a Little League team. Let the Girl Scouts do a car wash in your parking lot. This is part of bonding with your community and becoming an established part of it.
Some more food for thought:
1) Whether in strong or weak economic times, all successful businesses must become more efficient. One overlooked method is to use the Internet for task automation which can be accomplished using e.g. open source software. Not only will you be able to hire less labor, you can indirectly have your customers become part of your labor force while increasing your target market! This allows your business to become more profitable.
2) Exceptional business folks know how to diversify their business during a weak economy by seeing what the 'new' demands are and how some CAN be related to their existing business model whether it is a product or a service. It's all about 'thinking outside of the box' as wealth is created during those weak times, too.
Examples of booming businesses during this time are the repossession business, repair business, junk yards, towing, and so many more industries. Although those folks are complaining there's too much business, they're living pretty right now. And remember, a lot of millionaires were created during the depression.
3) Collaborate with other businesses whether or not they're in the same industry as yours.
4) Consider sharing advertising costs with other businesses as advertising during weak economies is just as important as during booming times (if not more important). Also note that the deals you get with advertising during these weak times is way better (like now).
HTH (hope this helps)
---International Business Network, LLC. (IBNETLLC.com)