recession survival tips
Recession Survival Tips
Tip #1: Be flexible.
A recession means that your buyers will be holding on to
their wallets more tightly, and will have to be selective in choosing a vendor. Slashing prices is not the only way to stimulate demand, however. Get an edge on your competition by offering Net terms to trusted buyers, or offering to split on or fully cover Escrow fees and shipping.
Tip #2: Disclose as much information as possible.
Buyers are in a situation where a loss on an order, or even just a loss of time, can be a critical hit. As a result, they’ll be looking to deal with vendors who are full willing and able to disclose exactly what they have in stock, in order to save time when negotiating. Be sure to indicate the manufacturers and date codes of your parts, and use the description column to provide any additional information that you foresee your customers needing to know.
Tip #3: Focus on your customers.
During this slump, keeping your existing customers will be vitally important. Be sure to provide superior customer service, before, during, and after each sale. Buyers will be particularly price conscious at this time, and so will be more likely to jump ship at the tiniest slip in your efforts.
Tip #4: Don’t cut too many corners.
Trade safely, as always. Parts being sold at ridiculously low prices may be tempting, but be sure to fully research any major transactions. While a low price may offer the potential of a large profit, it may also be an indicator of trouble to come. If in doubt, use Escrow to ensure you have control over your funds – the cost of which is much lower than a potential rework or lost customer!
Tip #5: Be creative!
Brainstorm regularly to find ways to save money. Save on paper and ink by going paperless, and purchase reconditioned office furniture where possible. While minor cost savings such as this may not have a huge impact immediately, little amounts can add up to impact your bottom line in the end.
Tip #6: Work to your advantage
Take advantage of decreasing costs and ask for better terms or better prices from your vendors. Identify products that may appeal to customers looking to cut costs, and cut back on supplying unnecessarily expensive parts until the demand for such products increases. If you can, dip into the larger and more skilled workforce while you can, and reap the profits of having excellent employees.
It’s inevitable that this slump will end, so take advantage of this slow period to build up your future business. Networking is a key activity, and you might meet many potential business partners who, right now aren’t buying, but in the near future, will be ready to move again. If you have those contacts ready, you’ll have the upper hand as the recession lifts. A recession is a time to re-build, so keep your chin up and put in some extra hours, especially in your sales efforts.
[As Published and Re-printed by The Broker Forum 5/2009]