4 Ways to Keep Your SME Business Afloat During Tough Times
Being a small business owner is no walk in the park. Not only do you have to rely on yourself to build your business, but you also have to find ways to keep your business going. This is especially tough during tough times like the economic recession or when sales are not doing well.
If you’re struggling to keep your business afloat, consider using these tips:
Look at the overall picture
It is essential that you don’t make rash decisions when handling your business. Instead of immediately tackling an obvious problem, take some time and observe the big picture. Understand the main problem and come up with a long-term solution for it.
For example, you might want to fire an employee for underperforming for several months, but is the person the source of all your troubles? Does the employee have the necessary equipment to perform? Does the manager properly train him?
Take a step back and look at the big picture. Find the root of the problem and come up with a solution accordingly.
Have access to cash
When sales are plummeting, there’s no better solution than having cash at the ready. It’s easy and almost instant.
However, keep in mind that obtaining an SME loan is only ideal for short-term cash flow problems. It is crucial that you have other sources of capital available such as getting money from your savings or borrowing from family members.
Keep your existing customers satisfied
Based on the Pareto Principle, it is said that 80% of sales come from 20% of clients.
It is every business owner’s dream to reel in more customers but attracting new clients will require six to seven more times the effort than getting an existing client’s sales. When you’re in tough times, you might want to save that money on loyal customers.
Reward your existing customers with exclusive discounts and services. This simple strategy will keep your customers happy and encourage them to do business with your instead of your competitors. In the best case scenario, they might even recommend your company to other people.
Concentrate on quality
When competing with larger companies, it’s difficult for SMEs to stay relevant in the market. Competing with bigger companies by selling at a lower price will result in losing profit in the long run.
Small business owners should focus on maintaining the quality of their products and services instead. It’s alright to sacrifice some quality to cut some cost, but not too much to dissatisfy your customers.
There’s no perfect strategy to keep your business afloat, but with perseverance and discipline, your SME should be able to get through the tough times.
Interested in getting an SME loan? Visit https://www.rhbgroup.com/products-and-services/business/business-banking/sme-banking today!