I recently came across an article in Chief Executive titled opportunities for SMEs in the downturn, which I thought would be a good read. I don’t know if it was good, but I was shocked by what I read. Although everything the author said was true, I was shocked at how the entire article focussed on gains that come solely from the losses of others. I know some people think business is ruthless cut-throat every man for himself, but I believe that it is possible to make gains without slitting your competitor’s throat and possible to get a good deal without forcing your supplier to the brink of bankruptcy. Maybe it’s naive of me, and that’s why I’m just a blogger and not a CEO of some big tech company … but for now, I’m going to think that way because the alternative isn’t very attractive.
Basically, the author laid out the following opportunity “gold mine” opportunities for SMEs:
- Scoop up the nuggets of talent among the layoff streams
There will be some really capable and talented people coming onto the job market over the coming months. … Grab them if you can and augment your current team. If necessary replace a ‘5’ with a ’10’ … and score big despite the global talent shortage.
- Swoop in and steal your competitors’ customers who fall by the wayside during a downsizing or restructuring.
Some of your competitors will likely cut back on sales and support as a reaction to slowing sales and adjusted-downward financial projections. When this happens, likely the support level for a few customers will drop noticeably and you’ll have a chance to lure them away with better customer service.
- Swoop in and steal your competitor’s customers who need better applications your competition can no longer provide.
Some of your competitors will likely cut back on development as a reaction to reduced sales. New product development will fall by the wayside. This is your chance to steal your competitor’s customer from under their nose.
- Look for ways to add value to your existing product or service.
Then up-sell your customers to extract every last penny they own.
I know this is classic, and rock-solid, business strategy, but what I’d like to know is why these strategies weren’t promoted:
- Reduce your cost of operations, and your prices accordingly.
Everyone wants a great deal, and in a down economy, everyone needs a great deal. If you can cut your operating costs, by applying good supply and spend management practices, and then reduce your prices, the customers should come to you.
- Increase your efficiency, and increase your support level.
Have multiple tiers? Unexpectedly promote your bronze customers to silver, your silver customers to gold, and your gold customers to platinum if they have been with you for two years. They’ll appreciate that and you’ve just gained customer loyalty … at no cost to you if you’re operations are more efficient.
Better products. Better services. How can you go wrong?
Because these strategies work if the market is up or down, and, to me, that’s better for the long-term health of your business.