A year of challenge


This year will be a challenging one for many of us; in fact survival will be the objective of many small businesses. Here I have gathered ideas and approaches – which are being implemented by clients – to demonstrate that proactive actions can have positive returns. Many of the ideas are as much about changing attitudes and behaviours as about taking decisive action.


Why should anyone buy from us this year?

This was the question for a recent workshop I facilitated. Yes it is good to know your USP (unique selling proposition) as it is a reason why people buy from you. But for most businesses their selling proposition is not unique. Location, accessibility, quality, convenience, customer service, price, reputation all contribute to purchasing decisions by customers. Make sure you know which elements of this package influence your customers.


Increase customer focus

Customer focus is a clear requirement, and I think it is more spoken about then actually delivered. Aim to provide excellent customer service to all existing customers and maintain relations with ex-customers. In fact go out of your way to be in contact with ex-customers, they still have potential to be won back, so aim to stay on their supplier list.


Business connections

In my mind much networking has limited business value and is social in nature (and there is nothing wrong with that!) – I suggest you focus on connections where they are of value to your business (or to your customer’s business). It is not how many connections you have on Linkedin but what is their potential value to you and your network.


Staff communications

Communicate to your staff: through the hard times talk to your staff more, share your plans and targets, and engage with them how objectives are to be achieved. United teams where conversation is open and ideas shared will weather the stormy months ahead.


Be online

Work out what makes sense for your business (blogs, LinkedIn, facebook, web directories, google maps etc). If you are selling to the mass market, put your message everywhere, if you are selling to a niche market make sure your potential customers know of your products/services and why they should buy from you. Attractive and cheap websites are available to all using software such as Joomla templates.



Treat key suppliers as valued customers. Forming partnership type relationships with your suppliers is more important now, make sure you have agency and distributorship agreements signed up and confirmed. There is little point in building a market for an OEM and then losing the agency because of poor communications and key supplier management.


Cash flow management

Yes, cash is the lifeblood of a business. Prepare your budget and update your cash flow projections at least monthly. Regularly updated cash flow forecasts and management of working capital are key to business survival this year.


Cutting costs

Several clients of Celtar have made considerable savings by renegotiating their rent in the middle of lease periods. Rent for commercial property has fallen everywhere back to the levels of five or more years ago. You are now in the driving seat and can use professional negotiators such as (only the more commercially minded of) solicitors to negotiate on your behalf.  


Shop around for professional services

One client has reduced auditor fees by 30% by shopping around, and staying with his current auditor. Negotiate solicitor’s fees upfront so you know what you are getting. For value for money advice on employment law join the SFA (www.sfa.ie) or ISME (www.isme.ie) and avail of their well regarded services.


Staffing reviews

In previous recessions layoffs and redundancies were the usual reaction to a slowdown. Now business owners are looking to a more flexible series of options. Why? Because there is a strong belief that the economy will recover sooner so keeping the talent that has been recruited and developed makes sense.

Reductions in salary, of 10 to 30%, are commonplace amongst Irish SMEs. In technology companies salary cuts are made reflecting today’s market rate for a job and bring salaries back to what they were in 2004. Often the senior positions are taking the most severe cuts, directors and managers are bearing the greatest decreases and are sharing the pain of dropped income.


Working time flexibility

Salary reductions are also being made through the introduction of three day weeks and other flexible working arrangements.

Frequently staff are put on three day weeks to cut costs. This option of making staff work part time needs to be managed effectively so productivity is maintained or increased.

Offering unpaid leave to your staff is a way to temporarily reduce your wage bill. If you are overstaffed at the moment, but expect you need staff in a year’s time when the economy picks up some staff may find the option of unpaid leave attractive.

Introduce customer focused flex-time as a competitive response to the downturn: an organisation’s opening hours could be extended without increasing cost. Implementing flexi-time should have the effect of creating longer open hours. As a customer I would like to see this happening for banks, accountants and solicitors.


Remember you are not alone

There are many experienced business advisers out there who will listen, advise and stimulate your ideas and activities.

So ignore the radio and TV reporters who appear to luxuriate in the bad news announcements, and get on with doing the business.


This is part of a series of articles on managing a business through the recession by Billy Linehan of Celtar, business and management consultants.


Billy Linehan is a specialist SME adviser who has been working with small businesses in Ireland and the UK for nearly 20 years. A director of the Institute of Management Consultants and Advisers, as well as managing a private consulting practice Billy provides a mentoring service to clients of the IMI and the Dublin City Enterprise Board.