Positioning Your Business for a Successful 2009
Gregory Clarke, Partner
A new year means a new start for 2009—and a hangover from 2008. I hear a lot of pessimism from business owners: “Will I need to lay off employees?”; “Will my company survive?”; “Where’s the stock market going?” Like any other cycle, the economy will turn around. Make time and good management skills your partners on the journey. Here are some tips to position yourself for better times:
Review product/service lines and pricing: Are you obtaining a sufficient margin on your products or services? Do a review at the individual product or service level. Identify the products or services that have low (or negative) margins to determine if you should continue with that business line or adjust pricing. You have finite resources—ensure they are focused in the most profitable way.
Cut back carefully: Many companies are reviewing costs and overheads for opportunities to reduce expenditures. For example, outsourcing may help some companies improve profitability by shifting aspects of business to cost-effective alternatives. This is prudent practice, but be careful where you cut back. Look for opportunities to be more efficient and spend money wisely, but don’t affect your ability to operate effectively.
Monitor your cash position: You need to manage receivables and payables. Are you comfortable granting credit to customers? Do the proper analysis and credit checks to manage your risk of bad debts. Consider requesting deposits on orders to improve cash flow and reduce your bad debt risk. Manage your inventory and don’t hold surpluses. You may need the cash for other priorities.
Talk to your customers and advisors: Hiding won’t solve your problems and won’t win you customers. Talking to people will. Identify what your customers need and see if you can help them. Understand their problems and facilitate solutions. Customer-focused attention will help you retain and grow your customer base. Talk to your bank as well—they should be aware of your plans and that you are proactively managing your financial situation.
Engage your employees: Combat the negativity your employees are hearing. Talk to them and share your strategies and challenges for 2009. This will ease their minds and quell their speculation. Remind them how they can work as a team to make a positive impact in the company.
Find your “sweet spot”: In golf, it’s called a sweet spot—that ultimate intersection of effort and results. Find the sweet spot in your business. What does your company do really, really well? Focus on this and don’t try to be something you aren’t.
Business may be tough but you can position yourself now for competitiveness when the economy’s on the upswing.
- Articles
- Library
- Links
- Financial Tools
- Canadian Tax Info Center
- Canadian Tax Updates
- U.S. Tax Info Centre
- U.S. Tax Updates
What our Clients Say
Joanne Pellegrino, Accountant, Izumi Outdoors Inc.
"In the three years that Ive been dealing with SB Partners I have always found them to be courteous, thorough and professional. Their work on our annual statements and tax returns is exceptional and their expertise makes my job a whole lot easier."