9 Strategies to Prosper in a Decline

The good times are over. Don’t think you can BUY ‘good times’ by simply:

? Adding more people

? Buying more equipment

? Spending more on marketing.

These can lead to further cash issues in the future, or worst, a forced acquisitions or the dreaded ‘B’ word, bankruptcy.

As Entrepreneurs, CEOs and Founders, we know we need to ‘zig’ when others ‘zag’ but what does this look like? It’s great having a long-term strategy, but you need to be equipped with tactics to work through the twists and turns ahead.

Let’s cover off some areas to get your zag on!

My key goal right across all my investments and the companies I mentor is to:

Invest capital to evolve and push into new areas that give?quick payback?in order to generate more cash. The short-term cash game.

Here are some areas to help you do the same:

1. Start extending your existing capabilities

Start looking for additional, complimentary verticals that are predicted to fair well into the future. For example, healthcare, food/agri and the growing mature aged market. With a few small alterations, your capabilities or products may be applicable to one of these markets. Start diversifying into areas that are more recession proof and not severely affected or tied to interest rates.

2. Focus on green offsets to your business and ESG initiatives.

Not only are conscious consumers on the rise, but B-Corp companies are faster growing, currently 38-times the national average. In my world of Impact Investing, access to capital is not drying up like other markets. As we all know, access to capital is a key driver of growth. Then of course, there’s your workforce, another critical component for scaling. Sixty-four percent of millennials won’t take a job if the company doesn’t have a strong Corporate and Social Responsibility stand.

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Then, of course, it’s the right thing to do! Imagine what impact your company could have if you stood for profit and purpose.

3. Harnessing technology and AI

Everything is up for review. Too many businesses have not evolved, probably because they haven’t had to. However, now is the time to rethink how you do things. The is best done by third party – a new set of eyes who are looking at your business as a set of systems, processes and units, each open to be automated or reworked using AI.

As a growth advisor, I am also looking for areas inside businesses where I can create additional value to maximize a liquidity event. Order a review and ‘spring clean’ of your business by a qualified and experienced growth advisor. You’ll be surprised what free cash is hiding in the draws!

3. Shift your thinking from ‘broad’ to ‘micro-granular’

The person with access to the best data wins! When it comes to my key drivers, marketing and sales, this includes being micro-granular with my targeting. We are continuously analyzing the data to give us insight into areas we can make improvements. Every 1 or 2 points improvements add up quickly. These all go straight to the bottom line. We also harness data to help spot cyclical trends to quickly leverage.

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4. Focus on the unsexy stuff

I’ve said it before – entrepreneurship isn’t as sexy as it looks. Now more than ever it won’t be the person with the best idea that wins.?Everything comes down to a process of metrics and being able to make decisions swiftly, and with confidence. As ITR Economics stress, we need to obsess over our monthly data, moving totals and rates of change.

5. Hybrid work forces are here to stay – leverage it

I am still astounded at the number of large companies I go into, $50M+, who have ‘lazy head count’. The most expensive part of running a business is still salaries.

My general rule is if you are not client-facing, a high-level strategist and problem solver, or an integral part of the executive team, I can usually find a way to do your job more affordably.

?Whether that be by utilizing tech or AI, or sourcing resources elsewhere. In uncertain times you the need your workforce to be more flexible, affordable and agile. We call this a Concertina model. Tap into offshore and near-shore options that give you access to larger, and more affordable talent sources. Ones that you can expand and contract as and when needed.

6. Focusing on after-market sales or recurring post-sale

Acquiring customers is not going to get any cheaper in the future. Plus, most companies have put too much focus is on the top of the funnel. Start focusing where the cash is – the end! After-market sales or a ‘post product’ is more profitable and predictable.

For example, if you sell wooden patio decks, look at maintenance plans. If you are selling beauty services or products, package it up as a subscription service. If you don’t have an after-market sale, create one.

7. Start testing and expanding into new territories that are predicted to fair well in coming declines

If your revenue is tied to one industry or one territory, your growth is also tied. If they go down, so do you. You need to start test new territories and verticals.?It has never been so easy or more affordable to go global. Some of the areas outside of American I am currently expanding into include Canada (which is the size of California), Australia (my hometown), and Mexico (the alternative to China).

8. Build up cash reserves to build your business EMPIRE

Cash is king, particularly in declines. Once you have built up cash reserves, it’s time to go shopping – business shopping! Do not be distracted and invest in start-ups or worst, create your own. In declines, your focus needs to be on acquiring existing businesses for low or no cost.

Businesses soon will be running out of hope or cash. We know first-hand business provides great cash flow, so get ready to leverage this. The future presents a huge opportunity for you to build your business empire.

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SUMMARY?

To recap, watch your numbers and become an Oracle – you need to master how to see the future before it shows up on your income statement.

Channel Randy Moss – you need to be the best in the game as ‘offense’ and ‘defence’. Expect twists and turns and be quick to make your move.

This may all sounds negative but it’s not. There are huge opportunities in downturns. Accept that the rules are changing and go do what you do best – channel your entrepreneurial spirit, be a brave leader and create your business empire.

For advice on how to do this for your company, apply to Tamara’s mentorship program:?https://www.beusailacademy.com/apply

For a deep dive, click here to view Tamara's 30-minute presentation on ‘How to Build in-house Marketing capability to utilizing tech and AI to Drive Growth’ :

https://youtu.be/UzzWwB9Cfv0