The times in Europe and outside Europe are undoubtedly hard. These are the times of reconsideration and re-validation of many politics and ways of doing business. In these hard times of repositioning on the market it is absolute truth that many of the companies will not succeed in resisting the stress, coming from low levels of market demand, very delayed payments, problematic cash flow and inability to meet their basic needs. And eventually they will die…
There is this widely spread concept that economy is a cyclic structure, meaning that there are times of rise which inevitably are followed by times of maturity and then again – times of rise and blooming. The challenge in front of the companies today, regardless of their size or structure, is to survive the so-called crisis which turns out to be much more than just a slow-down in the economic cycle. I would rather name these times “times of utter restructuring”.
I would give you 3 things that are good to know in times of recession, as I do not expect to surprise you with something you have never heard before, but rather to make you think of the way your company is doing business and operating today, in this situation, on these worrying and hard to deal with markets.
1. Review your invoicing and debt collection tools!
Let’s face it! Today more than 40% of the companies are struggling with the generation and the management of their cash flow. And this a central issue for the business! First step of start dealing with this is to review your invoicing system and collection tools. Instead of invoicing clients at the end of the month restructure the payment systems to a weekly or twice per month payments. You do not have to experience every single month payment troubles just because of the fact that you have built your payment system in a way that does not respond to your needs and objectives today! The eventual target is to improve the temps of your cash flow and by this to integrate a bigger dynamics in your business in general.
2. Improve your customer service!
A recently conducted research by Strategic Planning Institute at Cambridge indicates that the most important factor for a long-term profitability is the quality of customer service, but not the quality that YOU think you provide, but the quality as it is perceived by THE CLIENT. Another research demonstrates that companies which show poor results in the clients’ service research, lose market share at the average rate of 2% per annum. Bad service, indifference, low level of expertise – these are all the most pointed reasons given by customers for changing their supplier. It does not matter whether you are the owner, the manager or the employee. You have got to pay serious attention on your professional attitude towards the clientele, because if it is perceived as not good nothing else will matter that much even if you are producing the most amazing product or service in the world. The conclusion is that if you invest in practices and techniques which you believe will lead to a greater customer satisfaction you are most probably expected to strengthen or even improve your market position.
3. Be more flexible!
Well, there is nothing we can do about it. The times that we live in demand from us to be flexible enough not only to meet the dynamics of today but also to manage the change and to make profit out of it. And this is absolutely obligatory if you want your business to sustain and to develop. What do I mean by change? I am talking about the market changes in the demand and the changes with the competition. Also the change is regarding the banking system and the government politics, the legislation and the tax regulations. In general, I am talking about the change in every aspect of the economy which change needs to be mastered by your company’s integrated structure and policy.