5 Tips for Spurring Small Business Growth During a Slow Economy
Small business growth during an economic downturn can be challenging. Learn some growth strategies that include multiple revenue streams and managing cash flow.
Did you know that 60% of small businesses in the UK fail three years into the industry?
With the UK in recession, it's time to step back and reassess your business growth strategies. Small enterprises suffer the most as they experience sales decline, demand loss, and employee reduction. As a result, pushing for small business growth becomes challenging.
However, there are many ways to achieve business goals and keep it thriving. Are you wondering how you can raise small business growth? Read on and discover some growth strategies that will keep your business running.
1. Keep Cash Flow and Credit Open
Cash flow problems result in missed opportunities to grow your enterprise. In addition, they create negative impacts on your competitive advantages.
To avoid such problems, take part in managing your cash flow. Start by knowing the figures and creating a clear vision. Your plan must include your lever points depending on the situation.
Make financial projections every month and track your progress. Remember to balance your needs with the available funds. When you foresee problems, ask for help from your financial managers.
Apart from cash flow management, it would also help to consider financing.
Often, creditors discuss the possibility of a recession and how they must prepare for it.
When it hits, expect the implementation of tight credit standards. The restriction makes it hard to find and apply for a loan.
When looking for financing, never narrow your search to banks. There are credit unions and other financial institutions that offer credit services.
2. Carry Out Smart Marketing
You can’t expect your products to sell themselves, more so in a slow economy. Marketing is essential because it allows businesses to reach the target audience. If you want to be ahead of your competitors, create a clear marketing strategy.
Your plan must define your unique selling points and target customer. Before marketing, determine the price of your product. Further, how do you want to promote your business?
Thinking niche increases your chance of succeeding.
Split your initial customer base into smaller segments to create more strategic marketing. For example, if you offer fast-fashion clothing, you must narrow your target customer to a specific age range or income bracket.
Many businesses use social media marketing to reach a broad range of audiences. Using Facebook, Instagram, and other platforms allows your business to create a buzz.
Apart from boosting brand awareness, social media marketing can increase your sales. Technology gives you different ways to reduce your costs and generate profits.
3. Diversify Your Business
As a small business, you have different diversification strategies you can use. Regardless of the economic state, growing your customer base or expanding your products are effective in small business growth.
Growing your customer base suggests you narrow your target audience into segments. As needs and demands change, you cannot always expect current customers to buy your products. If you split your target audience, you can reach customers who need your product more.
The following strategy focuses on expanding your products. It promotes the idea of selling new goods or services in new markets. With this strategy, you must add products you believe your current customers need.
However, this business growth strategy is high risk because it needs high financing. With the risk-return trade-off, you can expect to receive a high return. The bottom line is you can guarantee growth for your business regardless of the strategy used.
4. Give Current Customers a Positive Experience
Balanced operations and practices are crucial to business growth. Although it’s good to attract new customers, you must never forget your current ones. All businesses must aim for customer retention and loyalty.
Offering excellent customer service encourages customers to come back. Studies show that 91% of consumers will buy again from a business after having a positive experience. Your existing customers can help you generate sales and promote your products.
Through word-of-mouth, you can expect several new customers to visit your store.
To continue serving with excellence, knowing and understanding your customers are essential. Consider giving discounts to regular customers in exchange for feedback. Doing so allows you to learn about their concerns and areas to improve your business.
You can also create an email list to stay connected with your customers. With email marketing, you can update them about your new products, special events, and sales. Further, you can use this strategy to collect feedback and thank your customers.
If you want your business to grow and thrive, improve your customer service.
5. Create a Growth Plan For Your Business
In an economic downturn, some businesses downsize, sell their enterprise, or close down. However, having a growth mindset can help your business thrive even in the worst of times. Start by creating a well-defined plan.
With all the small business growth strategies, consider this the most crucial. A business plan covers your goals and the detailed steps to reach them. This allows you to identify your focus and pursue growth.
First, gather data on your current sales, pricing, costs, and profit margins. Next, find out possible price increases that can affect costs. Then, calculate the growth amount you need to keep your small business viable.
Never forget to assess your product sales. Determine which products sell the best and which fall behind. Doing so lets you know if your strategies are efficient.
Your plan must include your cost-benefit analysis for each investment. How do you plan to go against your competitors? These are crucial in small business growth.
How to Spur Small Business Growth
Growing your business can be difficult when you're facing an economic downturn. While there may be some speed bumps along the way, a good small business growth strategy can help you stay afloat and even generate more profit! These ideas, however, are only the beginning.
At Jumpworks, your business needs and goals are our priority. With 30 years in the industry, our team has what it takes to guide you on the right path. Contact us today to learn more.
