What can you do to cope and increase your company’s chances of survival in these trying times?
There are plenty of other things you can do, besides reducing costs. Here are a few suggestions to set you thinking.
Structural changes
This is the time to realize structural changes. But remember to keep looking forward, even now. Focus all your attention on activities that help to generate a positive cash flow. Cash is king!
- If a part of the business is losing money, for example, close it down sooner rather than later.
- Focus on your digital platform.
- If remote working is proving satisfactory, evaluate whether you could save money by cutting down on office space.
Strength in numbers; consider merging with a competitor or partner as a way of improving the alignment of your proposition with current – and future – market demand.
Optimize efficiency
- Improve your bottom line and cash flow by focusing all your efforts on sustaining – and subsequently growing – your profitable activities.
- Reduce working capital – strengthen your relationships with customers and suppliers by entering into dialogue with them and tackling this situation together.
- Analyse your cash flow and proactively engage with banks and investors. There is still plenty of funding available. Show that you have insight into the situation and press ahead. Putting things in place now will help you to remain calm.
- Reduce your costs:
- Overheads: benchmark your performance. Are they really as low as possible?
- Purchasing costs: don’t just think about re-negotiating prices, but evaluate whether you could make more efficient use of materials too.
Are there opportunities for growth?
- Think twice before slashing your marketing budget; marketing is a strategic investment, NOT a short-term cost. The demand side won’t disappear forever. Even this crisis will pass eventually.
- How can collaborative partnerships help your customers and suppliers to ride out this situation more successfully?
- The world will look a little different afterwards. If you’ve already spotted opportunities, start seizing them right now.