By Audrey Korir
Ask any entrepreneur you know for business advice and you will often hear them tell you, “Starting the business is the easier part, the hard part lies in sustaining it!”
For you to run your business successfully you need to extensively plan and strategize for both good and bad times.
Our Kenyan economy has been very turbulent. The cost of living keeps rising every day which ultimately increases the expenses of running your business.
However, this is not the time to give up!
If you are a smart entrepreneur who does not want to see your investment go down the drain, then this is the time to tighten your belt and make strategic decisions.
So how then can you ensure your business survives these tough times?
1. Cutting Costs
One of the major reasons businesses fail is due to financial problems. You need to strike a balance between how much money is flowing out and how much is getting into your business.
Bad economic times, obviously means that you will not be getting as much income as you are used to. This means that your business will suffer a cash shortage. When this happens, it is time to cut down on costs.
For example, if you were planning on painting your building, expanding the business, buying new equipment, or hiring additional employees, you should hold it off.
Focus only on the necessary costs, your priority is to keep operations running smoothly.
2. Have a backup plan
It starts by identifying the risks that could potentially harm your business. In this case, the tough economic times are what you should prepare for.
You will need to come up with a financial backup plan so that when your business is not earning as much money as it normally does, you can still cater for the running expenses.
Having an emergency fund set aside will help you deal with cash flow problems when they arise.
3. Avoid debts
No matter how difficult it gets, don’t make taking a loan an option for your business. The loan is another expense that will pile onto what you already have to deal with.
You may think that you are doing your best to salvage your business but this may force you to close it down.
To avoid this, when you sense the business is beginning to struggle financially, review your debt policies. Communicate to your lenders early and renegotiate payment timelines or amounts.
4. Focus on Customer Satisfaction
Work on retaining the customer base that you have built up with follow-through, good customer service, and quality control.
Satisfied customers are loyal customers.
They will market you to others especially if you treated them well and ensured they got quality services.
Word of mouth is a great way to market your business at no cost and you also get customers who want to pay for your product or service.
Challenges exist in every business; they just vary depending on the nature of business you run.
However, issues like tough economic times cut across everyone in the business industry.
What sets you apart is how you choose to deal with them. The key is to prioritize and aim to be strategic in every decision you make.