Since the World Bank predicted the slowing of the global economy in January 2008, the business sector has been transfixed by the perpetual financial crises that have plagued international headlines. With Cyprus being the most recent source of bad news to dominate world financial reports, the potential for business growth, as well as the future outcome of the global economy, remains a contentious issue amongst corporate thought leaders.
Prepare your Business for Economic Recovery
While the future of the global economy looks uncertain, let’s focus on the importance that promoting economic recovery and encouraging a more confident consumer holds in today’s marketplace.
Many Signs Point Up
Business owners have become practised experts at dealing with a down economy. With the possibility of entering a new phase in the current financial crisis, and consumers cautiously broadening their spending habits again, perhaps it’s time to start focussing on cultivating business growth and diversification in 2013. Prudent thinking dictates that you should be ready to take advantage of any anticipated improvement in the economy; and your existing employees are the best place to start.
Invest in Your Employees Again
When budgets and deadlines are tight, employee training often takes a back seat. It can be one of the first in-house building blocks that see a reduction in a sour business climate. Consequently, it’s one of the first things that should get prioritised when there’s a turnaround. Re-think the optimal positioning of employees within your business organigram, both new and existing, and get pragmatic. Allowing your employees to increase their own skill set, with the end goal of handling an increasing and possibly more diverse workload, is a win-win situation. It is also a recognised deterrent to high staff turnover rates.
Sourcing Talent
In terms of hiring talented new people, all businesses are faced with a degree of uncertainty. A question that many businesses are confronted with is how to deal with hires that go on to show less talent than expected? As Gary Vaynerchuk, the co-founder and CEO of Vaynermedia, insightfully points out: predicting talent is impossible – but testing talent is not. When hiring a job applicant with excellent credentials and impressive social skills, take time to observe them during their probation period. If they don’t deliver during the interim, either extend their probation timeframe or fire them. Professionals who assert their talent and prove their value, on the other hand, should get rewarded with a permanent contract. It’s a harsh truth, but one that business owners need to adopt if they plan on making their corporate ventures a success.
Review your Company’s Digital Presence
An alternative way to prepare for growth is to acknowledge the role that the Internet and its accompanying new technologies have played on the huge transition that the global economy has gone through in the past five years. You need to decide whether or not 2013 is the year your company is going to embrace this change and capitalise on it. Vaynerchuk credits social media for the level of success he has achieved. The lesson for business owners: are you not where you should be simply because you choose not to embrace Facebook, Twitter, YouTube, or blogging for your company? Don’t be indecisive about allocating additional funds to boost your marketing energy in a digital environment where customers are becoming more comfortable about spending.
Take this a step further and review your company website and social strategy. For example, you might want to first consider upgrading your hosting plan to provide a scalable environment for increases in traffic. Acquiring new customers is a key business objective and an important element of any economic bounce-back. Your aim should be to meet customers where they’re engaging in consumer activities, which is slowly but surely within the online and social space.
Lease Leveraging
Lastly, consider planning for future growth by pursuing inexpensive financing opportunities to reduce business costs. In other words, enjoy the few benefits incurred by a struggling economy, which includes historically low interest rates. For example, if your business involves any form of property leasing, consider leveraging lower rates by negotiating attractive price escalations and renewal rates.
Have Confidence in the Consumer
Michael Lombardi, an MBA graduate and respected financial writer for Profit Confidential, wrote in 2008: “In my life, all the recessions I have seen or studied have only come to an end when consumers start spending.”
So while an economic revival is by no means certain, it is important to position your company for increased consumer spending which will carry significant benefits to your bottom line.