In the Telegraph today it was reported that there is now the largest number of insolvencies in at least half a century. A record 35,000 people were declared insolvent during the three months to the end of September, the largest number in at least half a century. Small businesses are particularly at risk during this continued recession, so what can be done about it? Everyone has heard about marketing your way through and out a recession but what can you do if you've only really thought about this now?
Some of the main causes for going insolvent are:
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Keeping too much stock and a lack of cash
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Not responding to what competitors are offering
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Not researching the area of business in enough detail
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Low investment or being under capitalised
So don't hang around, see what you can do about any of these problems before they arise. If you have too much store and / or a lack of cash, think about creating a promotion to release some of the equity you are holding in your stock room. Be aware of what your competitors are doing, not only must you make sure you are more visible than they are but you've got to keep up with the competition. Also, your competitors’ businesses may be failing - make sure you are the company standing out incase their clients are looking for a new supplier. Offer special incentives as early as you can for them to try your services before they go hunting for alternatives.
Make sure you are investing in the right areas of your business - don't cut back in vital functions or those that will get you through the hard times. Some companies make the mistake of cutting marketing budgets at a time when you should be taking advantage or lower marketing costs and making your company the one of choice. Save money by managing your business well and making your processes more efficient.
See the Promotr Marketing in a Recession page for more tips.
