According to the latest statistics, UK GDP fell by 20.4% in April 2020. With May 2020 forecast at a similar level, economic experts are forecasting a likely recession.
For business leaders across the UK, this period is likely to be one of the most challenging they will ever experience with millions battling against declining revenue, lack of customers and the complexities of the ever-changing furlough scheme.
However, with every period of adversity comes true opportunity, as long as you as a business owner are prepared dig your heels in and fight for survival.
With that said, what steps can entrepreneurs and business leaders take in order to push through this pandemic and emerge stronger once we reach the other side?
Step1: Be Honest with Yourself
Writing down inflated figures and burying your head in the sand won’t solve anything, in fact it will make matters worse.
The first step you need to take when under siege is to be completely honest with yourself about the severity of the situation and the short and long-term impact on your business. The UK economy is and will continue to struggle over the coming months and a recession looks likely. However, how you respond and what action you take is down to you and you only.
The sooner you accept the situation for what it is, the sooner you can fight back.
Step2: Evaluate what needs to change
One key thing that separates a good business owner from a poor one is the ability to make fast and tough decisions and stick to them.
Take time to evaluate every single part of your business to understand what needs to change to put it in a more profitable position.
Which staff members perform badly? What costs could you cut that aren’t essential? For essential costs, could you form new supplier agreements with a temporary reduction in fee? What can you sacrifice? What does your business need to generate new revenue? How can you create a new and successful sales and marketing strategy?
All these questions are vital to gaining a clear insight into what you could change for the better. Trust your gut and be decisive in your approach.
Step3: Create a 90-day plan
Those who are most successful in business are those who regularly write down their goals. If you don’t do this, now is the time to start.
Think about where you want your business to be in 90 days’ time and create a clear and focused plan that will help you get there.
While it’s important to not overwhelm with too many goals, you need to ensure you focus on key objectives that will help to rebuild foundations and make the business stronger.
For example, a 90-day goal that every business should have is to increase their cashflow. A lot of your customers are likely to be holding on to their cash at the moment in a bid to strengthen their own position, so agree payment plans where possible and ensure that one of your targets is to reach a certain cash amount at the bank.
Step4: Refine Operations
A key part of survival is looking at your current business processes and assessing what does and doesn’t work. Essentially, you need to provide a strong reason for your customers to stay with you at this time and not move across to a market competitor.
If you have weaknesses in your customer service processes, change them. Or if your production processes are slow, impacting the timeframe from order to delivery, review why this happens and start making meaningful and positive changes.
Despite the real challenge presented by COVID-19, we have been forced to wake up and assess how ‘good’ we are as business owners. So, don’t waste it ‘ maximise it.
Step5: Don’t ‘go dark’
Evidence from Millward Brown following the recession of 2008 revealed that 60% of the brands that went ‘dark’ [i.e. no advertising or marketing activity] during the economic downturn saw a ‘brand use’ decrease of 24% and brand image decrease of 28%.
The same evidence also revealed that the brands who cut their ad and marketing budget at a higher rate than their competitors were at a greater risk of losing market share.
The lesson here is that although it may feel tempting to cut your sales and marketing budget in the short-term, you will put your business in a much weaker position in the long-term.
At the moment a lot of your competitors will be scared to spend and will be thinking along the same lines, providing you with the opportunity to dominate your sector through an innovative and impactful sales and marketing strategy.
Remember, some of the best brands have emerged from previous recessions with WhatsApp, Instagram and AirBnB being prime examples. There is still opportunity for growth and market domination. Stay focused, keep pushing and in the words of Winston Churchill, Never, never, never give up.