Dear Professor Bruce:
I am a small business owner in need of cutting expenses. My customers are spending less money and I need to keep the doors open. How can I serve my customers and remain profitable?
Answer:
In times of adversity there is always opportunity. According to motivational speaker and Edible Arrangements franchise owner Scott Greenberg, now is a good time to solidify relationships with customers and innovate new ways to market. "Many businesses actually thrived during the Great Depression by adapting to the economic climate and taking advantage of the many bargains to be had." Here are six ways to save money and get more bang for your buck:
1. Market your business through great customer service. Nothing beats word-of-mouth marketing, and nothing creates better word-of-mouth than serving your customers well. Your competition was probably providing mediocre customer service during prosperous times. If they're in survival mode now, you can pull ahead by treating your customers like royalty, even when they're spending less.
2. Negotiate with your vendors. They're struggling, too. It's a buyers market. In this relationship, you're the customer. Offer loyalty and consistency in exchange for lower prices.
3. Consider new vendors. Many office products really can be purchased for considerably less on the web than what you get at office superstores. Even with traditional suppliers, prices fluctuate. Re-price out all of the items you've been purchasing and make sure you're getting the best rates.
4. Barter. Your products and/or services can be exchanged with many businesses in the same position as you. Don't just barter for your business needs. Consider your household and personal needs as well.
5. Manage your employees. Watch how they work and make sure no time is being wasted. Keep them trained for maximum efficiency. In the current environment, jobs are scarce. You should expect and insist on great performance.
6. Advertise. Ad rates are rock bottom during an economic crisis. Your competition is scaling back. Here's where you can make your move. For small businesses, there are advertising opportunities previously not feasible. Contact larger print media and radio stations and you'll be surprised what's currently possible. It may seem like more advertising defies your plan to save money, but the increase in business will leave you with a net gain.
For more information, contact www.scottgreenberg.com.
(Bruce Freeman, The Small Business Professor, is president of ProLine Communications, a marketing and public relations firm in Livingston, N.J., and author of "Birthing the Elephant" (Ten Speed Press). E-mail questions to Bruce(at)SmallBusinessProf.com.)
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