SMEs really do have the best of it and the worst of it. They always battle to access finance for a variety of reasons both inside and outside their control. Thats the worst of it. But lets look at the other side of the coin.
SMEs have flexibility and management control. So what should we do to survive the recession.
1. Act - make decisions and do something
2. Review all costs and cut what you can. Just get rid of the fat. Do not destroy your business' capacity to meet the clients' needs. But remember, no one ever saved themselves out of trouble.
3. If it is tough for you, it is tough for almost everyone. So, contact your suppliers and see if they can provide you with better prices. They need to keep your business to survive, so they may well be prepared to offer better pricing, and perhaps even better terms. If so, take advantage.
4. Visit your clients. Change your pricing methodologies so that competitors find it difficult to compete on price as they cannot understand how you have priced to the client. Change the rules of the game so that competitors have to stop competing to understand the rules.
5. To change the pricing to the client includes the necessity to change how you do business with your client. Can you add more value? How? Offer this to the client! The more value you add, the lower the client's costs should be. The more value you add, the more difficult to unravel your pricing.
Essentially, be proactive and not reactive, and keep your creativity levels high. Read a lot to find new ideas.
Dr Rob Smorfitt