Most economists regard recessions as a natural, inescapable phenomenon that follows extended periods of positive growth. As such, running a small to medium-sized enterprise (SME) during such a time can be a uniquely unsettling experience. However, these difficult times also offer business owners plenty of golden opportunities to rebuild their venture into something better than it was before. Indeed, despite the challenges, strategic decision-making and adaptability can pave the way for transformative growth and resilience in the face of economic adversity. Here are five essential tips that could help you guide your business through the next economic slump.
1.Maintain and Expand Your Cash Flow
Experienced entrepreneurs understand that cash flow means life, even in the best economic circumstances. When things take a turn for the worse, having sufficient cash flow makes it easier to weather any challenge to your business.
Taking out a business loan isn’t always the first thing that comes to mind when discussing cash flow, but having a business banking loan product you can rely on can give your SME an additional measure of security that it wouldn’t have otherwise. The popular Maya Flexi Loan product from Maya Business can provide up to PHP 2 million in liquidity at short notice, making it possible to address most emergencies your SME might experience during a recession. Unlike other loans for businesses, the Maya Flexi Loan credit line also comes with low fees and simple payment terms, making it easier to focus on surviving and thriving in tough times.
2.Do What You Do Best
When times are good, businesses and creditors are more willing to take on more risks. During economic downturns, this willingness disappears, and playing to one’s strengths is usually seen as the winning move. While there is some argument to be made about exploiting new opportunities arising out of recessions, most SMEs simply cannot afford the risks.
Playing to your strengths is good advice even during economic booms, as it not only avoids risk but also lays the groundwork for more streamlined operations. Going with a targeted approach that leverages your advantages can also allow you to deliver better value to your customers, as you’re no longer distracted by experiments and low-performing product offers. These benefits can even provide your business with an extra boost when the wider economy begins to improve, later on.
3.Focus on Maintaining Your Existing Customers
When the economy starts dipping and budgets become tighter, it makes sense to cut back on new customer acquisitions in favor of nurturing and maximizing the potential of your existing customer base. Look into loyalty programs, personalized services, and other methods that can improve relationships with existing customers. These programs generally cost less to run per sale compared to new customer acquisition projects, making them a potent way to maintain revenue during downturns.
4.Don’t Stop Promoting Your Brand
While you should probably be focusing on existing customers during an economic recession, it’s also important to maintain sufficient brand visibility at all times. Your customers’ purchasing and consumption habits may also change at this time, so you will also need to adjust your marketing strategies to keep pace. Be sure to leverage cost-effective digital marketing channels and use better-targeted campaigns to maintain visibility among your key customers.
5.Don’t Compromise On Quality
Lastly, it’s also worth remembering that economic downturns will affect most customers’ buying power. Regardless of what you do, it’s likely that many customers will be looking for cheaper alternatives to whatever you might be providing. As a result, it may become tempting to cut back on quality so that you can compete on price.
While this strategy can work for some businesses, it can be unsustainable for many others. A reputation built on low-quality, low-cost items might work during an economic downturn, but it can also permanently damage your brand. When the economy eventually recovers and people have more to spend, your brand may be stuck with a reputation for low-quality goods that no longer resonates in the new climate.
If you have to cut costs, explore operational efficiencies and strategic partnerships that allow you to uphold the standards that define your business. Maintaining consistent quality even in tough times builds trust with customers and keeps your business viable over the long term.
Stay on Top of Any Downturn with Maya Flexi Loan
The right business banking loans can give your small business the funding it needs to emerge from an economic crisis, stronger than ever. The Maya Flexi Loan credit line is trusted by thousands of Philippine SMEs for its excellent rates, simple terms, and fast service. Sign up for Maya Business today to enjoy the business loan Philippines’ top SMEs depend on.
Signing up for Maya Business instantly qualifies you for a Maya Business Deposit account for your settlements. Your account comes with an astounding 2.5% per annum interest rate, making your funds grow 20-25x faster than other business savings products, earning you an extra PHP 25,000 each year for every PHP 1 million deposit. With zero maintaining balance and free transfers via InstaPay and PESONet, Maya Business Deposit ensures you’ll also save more with your everyday business banking.
Signing up also entitles you to a Maya Flexi Loan offer of up to PHP 2 million in just 3 months—perfect for covering cash flow issues and emergencies that come up during economic slumps. To improve your next loan offer, just use Maya as your primary processor for all wallet and card payments.
Send in your Maya Business application to receive your first Maya Flexi Loan offer!
