By Paul O’Brien
When a business is going well, we have a tendency to become complacent and forget what we did to make it successful. Sadly, business has a tendency to work in cycles and if you aren’t careful, your successful business can experience a downturn and quickly become a ghost town.
Suddenly your sales drop, your bottom line is reduced, and you need to start looking at staffing and what you can do to stop a very successful business into a failing business venture. This happened during the GFC to a business which I was running and instead of cutting staffing, we looked outside of the box to look at what we could do and how we could do it better.
The first thing that you need to do is to stop panicking and take into perspective the whole situation so that you have a clearer view of the where you are and what you can change.
Once you can think straight, analyse the books and look at the following and ask yourself these questions:
- What market sectors are your clients in?
- Who are your biggest clients and why? Can you gain more of these types of clients to reduce risk and spread your revenue across more clients?
- What market sectors are your biggest clients in?
- What market sectors are experiencing a downturn, which are stable and which sectors are experiencing growth?
- Can you re-negotiate your expenses?
- Can you restructure your company?
What market sectors are your clients in?
If they are all in the same sector, then your business is very risk adverse and has a good chance of failure if regulations or legislation changes in this sector, or if there is a downturn in this sector.
Try to spread your business across multiple market sectors to reduce risk and improve revenue.
Who are Your Biggest Clients and Why? Can you gain more of these types of clients to reduce risk and spread your revenue across more clients?
1 or 2 big clients makes for a very risky business model, because if you lose them, you may lose your business.
If you have more larger clients, the less chance of a major loses to your business if they leave, renegotiate terms or implement your service or product into their business.
Don’t ever think that your business is irreplaceable. People use outsourced services because it is cheaper then having the service inhouse. If they are paying you too much for your services, a new financial adviser may ask the simple question, won’t it be cheaper to have someone inhouse doing this job and it may be one of your staff members who they head hunt for the role.
What Market Sectors are your Biggest Clients in?
If you understand this question, then you will improve your knowledge of your industry and market, putting your business in a better position to handle downturns.
By understanding what market sectors which your biggest clients are in and why they use you, you may identify potential markets which you didn’t know existed beforehand and may be able to improve or …read more
Read more here:: B2CMarketingInsider