7 Recession-busting Tips for Businesses

The outlook on the local and global economy points to a global recession – which leaves many businesses asking what they should do. While it may be tempting to make drastic changes during tough times, it is important to focus on business basics while bearing long-term sustainability in mind. Drastic changes can hurt a business in the long term. However, declining cash reserves, revenue streams, and profit can make it hard to stay the course.  So, some tips for uncertain times are:

1. Adopt a revolutionary-thinking mindset

Often, businesses tend to stick to the more traditional, tired-and-tested ways of thinking. However, times of turbulence or uncertainty should encourage organizations to step up and seize opportunities.  They need to be flexible so that decisions can be made more quickly as the market changes.

A lot of theories and great strategists suggest that strategy is meant to be a revolution and that history has shown that it is the rule-breakers, those who are daring, who get to the top.  History has also shown that these rule breakers experience huge success, change the face of business to improve their position, and add significant value to their client’s businesses.

Organizations could break out of the traditional way of thinking and do things differently by thinking differently.  It is not to say that every organization will change the industry, but revolutionary changes can also occur within the organization itself.  It involves thinking differently and finding alternate ways to save money, create efficiencies, and perhaps even create new products.

2. Never stop innovating

Innovation brings numerous benefits: efficiencies, productivity, competitiveness, revenue, and market share.  With so many positive changes, it just makes sense to focus more on innovation. Innovation leads to growth.  Importantly, innovation should not only be introduced on a product level but should be extended to services, pricing, and product offerings.

Innovation should occur consistently, regardless of whether there is a recession, or not.  If an organization finds a new idea during a recession, it will aid in catapulting its growth when the market turns.

3. Engage in client-focused initiatives

Clients are concerned with pricing and sacrifice quality to save money in tough times.  Pricing issues can be overcome by offering value-added services.  This raises the need for organizations to create and implement a client strategy with the aid of relationship marketing.

Businesses should ensure that their client engagements are spot-on and that they have a complete understanding of client’s needs.  Organizations need to be actively involved in their client’s business to aid them in achieving their goals, thus, categorizing themselves as a preferred trusted partner.

4. Set your R&D priorities

R&D can take years before an organization will be able to experience tangible outcomes, which is why selecting R&D priorities is so important.  Therefore, it is critical to have a roadmap of new products and try and anticipate where the markets will move.

Priority selection takes foresight and a large amount of planning, as the R&D programs need to be set for the environment that will exist at the time the R&D is completed.  This requires competitor data, market data, and foresight.

5. Find new ways to fund R&D

R&D is always a gamble with initial investments of large sums of cash to fund the project without any cash inflows being earned from these projects.  It becomes a balance between investing in new technologies and enhancing current technologies that is already earning revenues.

During a recession, there is often a shortage of funds to invest in new research areas and technologies.  However, the risks of stagnation and falling behind a competitor become extremely high when R&D is neglected. New funding could be gained through joint ventures, new share capital categories that carry no voting rights or partnering with competitors to open a new market.  Organizations can even explore partnerships with clients where they fund part of the development at preferential rate.

6. Align the basic business elements

Strategy is any organization’s blueprint and must be clear, easy to understand, and well-communicated.  Success lies in ensuring that the fundamental elements are in place and that they all have the correct required focus as highlighted in the various models in the review.

Each area needs to be defined, and a plan needs to be created for each one which needs to tie into the overall vision.  Ensuring that all components work hand-in-hand and that there is no conflict is also critical.  Behind all of this, is the knowledge of what an organization stands for, is passionate about, and strives to achieve. If one area is missing, or not given the necessary focus it could result in issues or even complete loss of focus.

Time needs to be spent benchmarking against competitors to identify what areas are similar, to rate who is better in each area, and where improvements need to be affected. More importantly, organizations need to explore what they do differently from their competition.  This uniqueness must be translated into the value proposition which is communicated to clients.

7. Control costs

Organizations need to implement proper cost control policies that are applicable during recession and non-recession times, including some pre-defined items that can be minimized or removed from the business during difficult times.

Now is the time to curb spending and ensure that funds are allocated to the right areas for long-term sustainability.  Organizations should operate with a tight cost belt whether in a recession or not.  This should apply to all below-the-line expenses.  Focus should be given to areas that help improve the long-term position.  Funds should always be available for product improvements and expansion (if the rewards are favorable).

Cost cutting needs to be implemented with the necessary research to ensure the appropriate allocation thereof. Organizations tend to cut marketing and advertising expenditure as it is a quick method of cutting costs and these results are seen on the bottom line almost immediately.  However, this may not be the best decision for the organization in the long term. The business may need to make other cuts instead and not reduce other items.

By staying consistent utilizing the right tools and skills, effectively controlling costs, and innovating creatively, businesses can build resilience and navigate their way through tough times.


Yvonne Dias
CFO, Mint Group. A visionary and strategist, and seamlessly manage the administrative, financial, and risk management operations of the company, including the development of a financial and operational strategy, metrics tied to that strategy, and the ongoing development and monitoring of control systems designed to preserve company assets and report accurate financial results. For the past ten years, Yvonne has gained a breadth of experience by taking care of the financial, compliance and operational processes of Mint Group, and, during this time, also served as the Group’s Independent Software Vendor Director to help grow and innovate the solutions side of the business.

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