Smart Ways to Run Your Biz and Thrive, Even in a Recession
By Salim Omar, CPA
I know that a lot of very big companies have been caught with their pants down, so to speak. And I know that many good, honest folks have lost a lot of money — or even their jobs — as a result of the current crisis, through no fault of their own. As entrepreneurs, we should not hide our heads in the sand and wait for “the good times to roll” again before embarking to grow our businesses! The truth is, NOW is the best time to grow your business!
Our Challenging Economy
The business that survives and thrives during hard times is the one that will be positioned to skyrocket through the roof and outpace its competitors when things get better.
In order to thrive during an economic slowdown, you need to know how to do things the smart way, and not waste money on strategies that won’t work.
I will share with you 6 easy ways to sustain your business and thrive in a recession.
By implementing these strategies, you’ll be able to acquire new leads, strengthen your relationship with existing customers, AND add new streams of income to your business. That means MORE money in your bank account!
Here they are:
1) Look at your pricing structure
I see that far too many small businesses have thinner profit margins than larger companies because they tend to under price their products or services. Pricing is critical to the success of your business. As a matter of fact, whenever my firm is engaged by a small business owner to boost their profitability, we look at the business’ pricing structure and often find an untapped surge of new cash and profits by tweaking it (visit my blog at www.OmarGroupCPA.com to learn more on the subject of pricing).
2) Engage in “good” marketing
In my recent weekly ezine, I elaborated on this. In a nutshell, make your advertising dollars accountable (i.e. track the money you spend and the return you receive from it). Also, DO NOT waste your marketing dollars on “institutional ads”, also known as brand/image building ads. Instead, small business owners MUST use direct response marketing with the sole purpose of the ad to generate a response and additional revenues.
Too many business owners are obsessed with chasing down new leads when they should be spending some of that time also figuring out how to sell more products and value added services to their existing customers. PS: To sign up for my free weekly emails, go to www.OmarGroupCPA.com. It’s fast and easy.
3) Don’t Overpay Uncle Sam in taxes
Uncle Sam was busy in 2008 creating four major pieces of tax legislation. That resulted in hundreds of new tax laws. Make sure your CPA is working for you, not the IRS. Does he or she meet with you for tax planning and to see how you can keep your tax bill the lowest legally possible?
4)Don’t carry the ‘wrong” type of debt It’ll kill you.
What is the “wrong” kind of debt to amass in business? The following would make the list: credit card debt, car-dealership vehicle loans/leases, personal loans at high rates, high mortgage balance, etc. Any debt that either is not necessary or that can be refinanced at terms that are more favorable is the wrong kind of debt. Plan to systematically review every outstanding loan and try to find a way to either pay it off (without compromising growth, of course) or refinance at a lower rate.
5) Use your time wisely
Too often, I see small business owners occupied with tasks that could be delegated. If you expect to earn $100k or more, don’t spend your time doing $12-$20/hour clerical types of activities. You’ll never reach your income goals this way. Don’t be shy to delegate those types of activities so your time and energies can be spent on high value projects and tasks. Be “ritualistic” when it comes to your day. For example, start each day with mind nourishment activities (i.e., read a book, listen to a CD, etc).
Then “block” time on your calendar to do the most important, high value type of work in the early part of the day. Don’t leave that for later in the day. Finally, answer phone calls and emails during designated times of the day. Managing your time and using it wisely will make a world of difference to the level of success you will attain in 2009, despite a challenging economy.
6) Develop a relationship with your customers/clients/patients
Develop enthusiastically satisfied customers ALL of the time. The biggest assets in any business, and the ones to assign the highest value to, are the relationships you have with your customers.
To my dismay, the majority of small business owners I talk to don’t maintain an up-to-date database of their most important asset (their customers) with key information like birthdays, anniversary dates, etc. The few that do maintain a current database don’t have a strategic plan of meaningfully getting in touch with their customers on a regular basis. This is a detrimental mistake.
To learn more, call Salim at (732) 566-3660. Salim Omar, CPA is a leading tax authority for small businesses in New Jersey. He is the author of the popular book titled, Straight Talk About Small Business Success In New Jersey, now available in all Barnes and Noble bookstores and on Amazon.com.
For more free information visit his website at www.OmarGroupCPA.com or call (732) 566-3660.