Survival is your first priority during tough times, but you have to be sure your business is healthy enough to respond once conditions improve. In “Six Ways to Emerge Victorious from the Recession,” Jon Frandsen, of Kiplinger.com, writes that a company “must make choices that won’t leave it crippled and unable to respond to pent-up demand when the economy starts to recover.”
Use Frandsen’s tips to make cuts that are essential, but not fatal:
- Make Cuts That Impact Customer Service the Least: While staff reductions are inevitable for many companies, Bill Dunkelberg, chief economist for the National Federation of Independent Businesses (NFIB) advises looking for those which don’t damage positive customer relationships.
- Target Fixed Costs: Everyone’s in the same boat, so your suppliers and landlords may be willing to negotiate on prices and rents. After all, less money from you is better than no money from you.
- Scour Every Monthly Expense: Take a close look at everything from telephone bills to cleaning services and look for ways to renegotiate or change vendors. Also consider what you can afford to eliminate without hurting your core business.
- Look Aggressively for Openings and Opportunities: An unfortunate fact of the recession is that some businesses won’t make it through. “That means their customers are freed up. Companies in a position to do so should be looking for them,” says Dunkelberg.
- Emphasize Value: With the shift from free-spending consumers to people guarding every dollar, value is more important than ever.
Take The Tip:
Click here to read more cost cutting ideas from Kiplinger.com.
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