Small-business owners in the U.S. are facing the toughest economy since the Great Depression, and experts note it is imperative that these owners maintain a dual focus that allows them to accomplish short-term goals while also planning for long-term business growth. Key areas to address include satisfying existing customers while acquiring new ones, acknowledging possible pricing variables in established client relationships and monitoring the pace of competition when making decisions about when to spend or save. For more on this continue reading the following article from TheStreet.
Do you know what you should be working on and doing, yet get distracted easily? I have clients like that. It isn’t a crime, but not being able to focus on important things such as getting results on projects and keeping costs under control when cash is low is dangerous when it comes to running your business.
Here are some warning signs:
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- You know what you should be working on to get revenue in the door and cash in the bank — including meeting with prospects, calling on customers or working on billable projects — but instead spend your time in meetings with people you aren’t sure why you are meeting; on social media for hours each day “following” the latest sports or entertainment news; opening every email the moment it arrives “just in case”; spending time and money on the latest smartphone when your business computer is eight years old and crashing at least twice a day (without a backup); getting in on the latest online community that is neither your field, your customer market nor valuable in its content to moving you toward your goal (again “just in case”).
- You focus on the “next” customer you can get when you are six weeks or more behind delivering a promised product or service to your existing customers.
- You take on community or association projects (such as volunteering) that require significant time and money away from the business.
I could go on, but you undoubtedly get the point. To survive through the near term, your focus needs to be on executing only those things that contribute to your survival.
I am a huge advocate of working in the business (meaning near-term objectives) while working on the business (meaning long-term strategic objectives), but there are times when, for the business to make it through to the long term, the focus must be on the reality of paying your bills and keeping your current customers happy.
Here are five key elements to focus on when your business is fighting for survival:
- Existing customers: Make sure you are keeping the customers you have happy. Get them quality products and services on time. Treat them as the valued customers they are. Do not take them for granted or they will take their business to someone else.
- Relationships versus prices: Do not fall into the trap of believing that just because you have a long-term relationship with an organization it won’t succumb to price differences. You may have done business together for years but when it comes to an organization’s bottom line no one’s going to spend $10,000 more for your goods or services if your competitor can and will do it just as well for less.
- Cost control and prevention: Everyone is tightening their belts and settling into long-term strategies to preserve capital and do more with less. You should be too. Every dollar you do not spend is a dollar you do not have to earn (again). Spend on what you need to keep your business running and getting customers. Keeping costs out of the business is easier than cutting costs later when you need to find some funds for the necessities.
- Competitiveness: Understand what is going on with your customers first. Then understand how your competition is going after those customers. Stay current on the trends, tactics and methods of identifying, capturing and serving your customers. What was working in a growth economy may just have been working because true competition was absent and there were plenty of customers for everyone, so if you were in business you had business. Now you must be sure you understand your business and its ability to compete.
- Goals and priorities: You do not have to give up on long-term strategic goals, and your actions during survival mode should keep them in mind. But spending too much time on the long term when you are facing near-term realities that could prevent you from being in business six months or a year from now mean that more time has to be spent on staying in business.
Stay focused on the things that matter. Be sure you keep things in perspective and set priorities that move your organization forward while it keeps its head above water.
This article was republished with permission from TheStreet.