2020 has brought a lot of fear, uncertainty and sadness for some. The year started with terrible bush fires, devastating communities. Although horrible, Australians have stood together in the face of adversity and through bushfires year after year. Australians can be counted on the give their support to local towns and remember the tragedy that consumed those business’s. What the world has never lived through is the shutdown and isolation of Covid-19. It is uncharted territory, with many people in charge changing legislation of business, hospitals and day to day life by the hour.
As a small business, the uncertainty of Covid-19 legislation makes staying afloat and in business a nightmare. Many shops do not know if they will be able to re-open again after their doors shut.
A recession was certain to come, the economy was pointing towards Australia having another recession, but Covid-19 has sped it up. Small business is sure to be hit hard, and most are already doing it tough. So how does a small business stay afloat with these uncertain economic times?
7 Essential Ways Small Business Can Survive A Recession
- Cutting Costs
- Clear Budgets
- Strong Marketing Strategy
- Increase Access to Customers
- Attract ‘Ideal’ Customers
- Apply For Small Business Grants
- Make Difficult Decisions
Most businesses to make even will try and cut costs as much as possible. Costs must be reduced, but you must be careful and specific to what you cut. It is always important to know your expenses and have up to date financial records. You want to know what is making money, and where is money going.
Reducing expenses where possible is essential. For many, cutting non-essential subscriptions has been the first reduction. Being productive about reducing bills and interests rates is another way to reduce costs. Often bills and interests sit high because we do not ask for a reduction. Most providers would prefer to keep you as a customer and reduced your costs then for you to transfer to their competition. Seeking out better rates and as your provider for a reduction, if they will not consider moving to a cheaper rate. Often this takes time that owners of small business do not have, but reducing any cost during hardship will help to keep your business afloat.
Budgeting For Small Business
It is important to know what areas of your business make you the most money and what will continue to make money.
Analyse the trend in your customers. For example, at the moment restaurants and cafes are solely providing takeaway. So many places that would previously make money on dine in expenses, such as additional glasses of wine or beer are not. Alternatively, their sale of easily transported food items have increased. Therefore, restaurants that know their stock take and change their sales according to market changes will have the most sales during these uncertain times. A small business must be adaptable to changing trends.
Identify what will continue to sell for your sales and services and cut those that will reduce or not sell and fail to provide you profit.
Small Business Marketing Strategy:
Although saving money is essential to staying afloat during difficult times, it is not a time to decrease marketing expenses. During a recession marketing costs are even more essential and should increase.
During a recession there is decreased expenditure, therefore decreased sales and leads. Consequently, any possible leads you want to be going to your business. During a recession those who control the leads, hold the power. Accessing and advertising towards customers rely on a strong marketing plan for your business. The more customers you can access, the more potential for sales and ultimately how you can stay afloat.
A recession is not a time to rely on word of mouth and leads through others. Your competitors will be in the same situation, desperate for sales and conversions. Therefore, you need to stand out above others.
How to Increase Access to Customers:
Most small businesses advertising rely on a facebook page or social media to access their customers. This is good as it allows customers to share content and see your products as they scroll through their news feed. To have a successful social media presence as a business it is important to post often. You need to balance spamming your page leading to customers unfollowing and providing interesting tempting content for your followers.
Posting to your social media page puts you in the minds of your customers as they browse over their newsfeed. You want your customers and followers to think of your business when they require your services. Attractive posts can also influence customers to desire and seek out your services, when previously they would not have been tempted to indulge in purchasing your products/ services.
Social media pages are great and influential to small business, but they should not be your only source of reaching customers, especially during a recession. When seeking a service people often do not search through social media, instead they search through google and other search engines. Social media is limited to the people you can access. Often business pages followers include previous customers or people that know staff connected to the business, a limited network. During good times, this is often enough for small business to survive. When spending is reducing during a recession, the limited network can hinder business sales.
Facebook and Google are in competition with each other and google does not search and rank the content of social media. Business Facebook pages will come up in Google searches, but Facebook pages do not rank well for frequently used searched terms. That is where a website is essential for small business.
Often when seeking services customers will review different options in google before choosing. For example, they will often search the job title ie, ‘Website Designer’ with location such as Gippsland. Alternatively, they will use descriptive language as well to find the services they are after. Ie, ‘Best website designer near Gippsland.’ It is important that you have a website that can be shown to customers as one of the potential options.
When customers do click on a website, they want an easy experience on how to contact you, what services you provide and where you are. Customers will judge your business on the professional front of your website. It is important for your website design to reflect your business and ease customers to contact you.
Attracting Ideal Customers:
One thing that we do at Websites That Work, is that with every website consultation we discuss with you who your ideal customers are. What type of customers bring in the most revenue, seek the services you want to promote or who are the easiest to work with? The ideal customer varies for different business but is important or attracting the sales you want.
Once the ideal customer is identified we put our head space into the mind of that customer. How are they searching for you business and what is attractive to them? It is then important to tailor your marketing campaign to advertise specifically for that ideal customer. A recession reduces expenditure and sales; therefore every sale becomes essential.
Grants For Small Business
Small business keeps Australia’s economy alive. Australian’s rely on small business for their services and for jobs. The Australian government need to support small business during financial hardship, as without them the unemployment rate increases as jobs decrease. Often a good government party will over grants to small business during financial hardships to help them stay afloat. During Covid-19 different state parties have offered different grants for small business who have been affected by the isolation and shut downs. Although, often inadequate on their own to ensure a small business survival, it is some help. Ensure your small business receives what ever help is available by remaining proactive at applying. There is often limited funds that is allocated for grants, so ensure it is your business that benefits. Stay up to date with grants available and apply quickly.
At the end of the day, if your small business can not remain open during a recession jobs will be lost for staff. Although hard, it is important for yours and your staff’s livelihood that you make difficult decisions to stay afloat. Recessions do pass and spending increases afterwards. It is important to follow current trends and make the changes crucial to your business’ survival so that after the recession passes your business can come out on top.
Profiting Out Of A Recession:
More millionaires are made during a recession than any other time. There is always potential for economic growth and to make money. A strong business will secure itself during good times so that it can survive and even build during bad times. Any of these steps can be performed during a recession or times of growth. A business that is always prepared for any economic uncertainty will perform stronger. No one could have predicted Covid-19 and the impact it would have on the world. Although a recession was anticipated it has been sped up by recent restrictions. The world has been shown how unpredictable business and the economy can be. Therefore, it is important your business is prepared for a recession at any moment and can readily adapt to change.
A business that has access to leads and the ability to contact and advertise directly towards customers will always come out stronger. Those who control the leads, control the power. A website and marketing campaign is your strongest asset during good and bad times.