RussBroomell.com

One of the funniest (well, really the saddest) things I have seen in this economic downturn is people who are giving up.  They have been in business successfully for years, and they have made money, but with all the bad news out there, they are giving up what made them great.  They are essentially outsourcing their focus.  They are doing it with the best of intentions, but almost invariably it spells destruction.

What do I mean?  Well, in theory at least, when you start a new business, you do it because you have some unique element that gives you a competitive advantage somewhere or somehow.  Maybe you cater to a certain market segment, or to an age group, or a geographical area.  Maybe your product is faster but more expensive than others and you cater to customers who are not worried about spending more to get the extra performance.  Maybe your product is bigger than your competitor’s and you focus on people who want a bigger, more durable widget.  Maybe your store is closer to a certain neighborhood and you focus on building relationships with people in that area.  Whatever it is, you went into business with some sort of focus.  Over the years, that may change as market conditions change, and that’s not necessarily a bad thing.  Giving up what made you unique, however, should never be done out of fear.

The problem in “the worst blah blah blah since the great flood” (or whatever the media pundits call it today) is that people believe what they hear and then they panic.  They start to lose their focus or worse yet, they outsource it entirely – they look at what anyone else is doing and believe that will save them.  Some say “well, I have years of experience in this business / location / market / niche, but some guy on MSNBC said that I need to make this change, so by gum I’ll do it.”  Others say “well, I’ve been turning a profit for 5 years now, but my customer is saying that I should change how I do business – well obviously they know better than me.”  It’s just crazy.

To quote a bunch of Presidents over the years, you really need to “stay the course”.  Sound management wins every time.  Here are 10 ways to beat this recession (AKA some cool fads that you may want to try out) (OK, really it’s AKA business management 101):

1. Keep the main thing the main thing – whatever you have done profitably in the recent past is probably not a bad place to stay.  Small tweaks to a successful model are usually better than chasing the latest fad.  You sell services to huge companies in your city, and several are really suffering.  Should change your products and pricing?  How about just trying another city first?  Maybe you see the price of widgets in your market is dropping.  Instead of closing down your widget business, try finding new customers or new markets, or just try making your business run more efficiently.
2. Cut out paperwork – no really, try it.  Every organization I know of over 25 people has at least one person on staff whose only job is moving internally created paperwork around, or preparing internal paperwork for someone else in the company.  Instead, spend some time and efforts rooting out waste.  If nobody reads the report, stop preparing it.  If two systems can’t talk to each other, integrate them.  If you are filling filing cabinets full of paper, knock it off.
3. Take a risk and sell something new – you probably have some service or product that you thought would be a good idea, but never got around to offering.  Pull it off the shelf.  Put it out there.  But ONLY if it fits your focus!  Don’t do it because someone else is doing it or for novelty – do it for opportunity!
4. Get rid of something old – you probably also have something that’s taking away time and energy from your main line of business.  Maybe it is generating revenue and it would not be popular to shut it down, but now is the time to make a tough decision.  Move those people over into the core parts of your business – they will be happy that you moved them rather then adding them to the long line at the unemployment office.
5. Share good news as well as bad – when you gain that new account, buy coffee and donuts for the office.  When sales drop less this quarter than last, have a celebration.  Be sure to praise the good things that your people do at every opportunity.
6. Make every penny count – don’t spend more than you have to.  Cut bonuses.  Sell the company car.  Ask everyone to give a little back.  Cut your own pay.  Cancel the cleaning service and vacuum your own office. Re-negotiate your lease.
7. Keep debt low – don’t borrow more than you need or better yet don’t borrow at all.  If you are making every penny go further, then don’t panic and borrow more money than you need, because you will soon find that you don’t need as much.  Negotiate better payment terms from your suppliers.  Shop insurance carriers.
8. Invest in relationships – customers, vendors, employees – they all matter.  Be open with what’s happening and ask everyone for help.  Encourage people to recommend new customers to you. Tell your existing people how important they are.
9. Pay your bills – and if you can’t then call your creditor and talk through what’s happening.  This is HUGE in making it through tough economic times, especially if your P&L has taken a hit.  Make some phone calls, have some meetings, work together to figure out how to keep goods and services flowing.
10. Reduce stress – give people a long weekend, have a company picnic at the boss’ house, start a bowling league – anything to help people feel more connected to one another and blow off a little steam.

One more thing … Do good – support local charities, encourage your people to go build a house with Habitat for Humanity, or donate blood or whatever.  Even though times are tough for you as a business, you will always find that giving something will be rewarding, so dig deep and find a way to do some good!

To sum it up, if you started a business and have had some success, then chances are pretty good that you know more than the so-called “experts”.  Rather than reading the papers and watching the news, spend that time working on your business, refining your focus, and sharpening your edge.  Don’t lose your focus or focus on what anyone else is doing – do what you do best and keep doing it!