(Credit: Programa Concejales por un Día - Colegio Escalabrini Ortíz)
Every small business owner has felt the pinch of a tight budget. It can happen at any stage of your business, and it might seem like laying off employees or cutting back on recruiting is the only solution. Perhaps you’re in the first year of your business and times are tough. Maybe you’ve been in the game far longer, perhaps even twenty years. It’s a frustrating point to be at. When sales are falling and customers declining, your bottom line begins to hurt. For many small business owners, your business is your livelihood. Despite this, it’s possible to power through the curve and use this as an opportunity to sustain the momentum of your business or at least get the tap of revenue to begin flowing again. Even when your budget is tight you can still maintain momentum and keep your staff employed.
There are every variety of small business imaginable. What each business has in common is that they all have customers and they all offer either products or services. If times are tough and your revenue is declining, it can be a good idea to first turn to your current customers or clients. These men and women are already familiar with your brand and product and will probably be open to speaking with you. Take the time to get to know their needs and how your product fits into the puzzle of their life. Is there anything that you could improve upon or add that they might be interested in? How can you better help them address the challenges that they face? Listen to your customers: they are a source of valuable feedback and potentially untapped ideas.
Here’s an example. Friendly local game stores are popular in part because they offer gaming tables where customers can bring in and play board games with their friends. These games can go on for several hours, and while they play you’re not making money. If you were to ask how the experience could be improved, they might say something about how it’s inconvenient to have to leave to find refreshments. Ah-hah! If you offered to sell the basics like bottled water, canned soda, or even snacks...you might have an opportunity to make more money AND reinforce your location as a great place to enjoy a good game. We’re talking about offering game store concessions.
A 12-pack of generic soda typically costs $3. Selling each for $1 apiece to a large group of customers is a quick way to make a profit with little investment. Instead of the gas station down the street getting money for chips and a soda pop, that money is going to your game store instead. It’s a win-win for you and your customers.
The next way that you give yourself more wiggle room is to rethink your expenses and examine where your money is going. This will require that you keep your financial books current, but that’s necessary when running a small business anyway. When going through your expenditures, try to identify anything that is unnecessary. Are you subscribed to a service or product that you no longer use? Unsubscribe and save money. You can also look at your necessary services like insurance and see if there’s a more cost effective way of handling it for yourself and your employees. Commercial insurance plans are a one-stop shop option, allowing you to ‘bundle’ different benefits instead of piecemealing them individually. Understanding the needs of your employees and customers will help tailor your decisions. Above all, remember that employees are not a slush fund and are not fat to be trimmed.
Look at your sales data and see what sells and what doesn’t. If a particular product or service has remained unsold for an extended period of time, consider discontinuing it or returning the product. You’re then free to redirect your attention and resources to areas that will result in a better return on investment. Think outside of the box and remember that change can be good when it forces you to take a closer look at how and why you run your business. Making adjustments on the fly will help you maintain the momentum that your small business and staffing needs deserve.