Rising interest rates, high energy prices, elevated inflation and al economic weakness has made many business owners pretty apprehensive. Kavan Choksi mentions that entrepreneurs need to prioritize future-proofing businesses so that it is able to run seamlessly and make profits, no matter the economic climate. Even though managing and growing a business in a volatile economy is surely challenging, with the right strategies one can effectively mitigate risks and ensure the long-term success of their venture.
Kavan Choksi mentions the ways to manage a business in a volatile economy
In a volatile economy, maintaining a strong cash flow must be a priority for a business. They can achieve this goal by competently handing their finances, while striving to cut down costs, boost efficiency, and generate more revenue. One cost-reduction strategy a business may undertake is to conduct a full review of all expenses of a company to identify areas where savings can be made. Entrepreneurs can choose to renegotiate supplier contracts to achieve better prices or payment terms. Conversely, an energy review may help find ways to save on utilities costs.
It is common to find businesses to pause their marketing campaigns to reduce expenses during an economic crisis. Doing so is however not a smart idea at all. Stopping the marketing efforts may cause a business to completely drop off the radar. For many major brands, their reputation and name can be enough to keep customers coming. But for smaller companies and startups that are looking to grow, a large amount of revenue comes from dedicated marketing campaigns that helps them to catch the eyes of the target audience and stand out from the crowd. Moreover, market fluctuations provide businesses to be truly present for their customers, and provide them with much needed reassurance and guidance.
Marketing campaigns helps a business to connect with new customers and promote its offerings in new spaces. Choosing to fine tune and scale up the marketing efforts of a business in times of crisis can actually be useful in improving its sales. Expanding the audience is a good way to adapt the business plans to encourage further sales despite of a looming recession. Moreover, opting to cater to an international audience can especially broaden the scope of a company when it comes to making sales.
Exploring secondary markets for a business can be a great way for brands to improve their long term outlook in a volatile market. Once they have expanded, businesses also get the benefit of n additional customer base to fall back on in case there is any such struggling situation in their primary market. In the opinion of Kavan Choksi, it is vital for businesses to properly plan and implement a growth strategy to search new markets and expand their venture before their current market flattens out. Doing so would provide a business quite a considerable edge.
Volatile market brings a variety of daunting challenges and exciting opportunities for businesses of varying types. Thinking for the long term, infusing more working capital than the usual, maintaining a productive work culture and having right people on board are critical for achieving success in such markets.