The Covid-19 pandemic has seen New Zealand small businesses take one after the other and the crisis shows no signs of ending anytime soon.
However, the strength of small and medium-sized enterprises (SMEs) has always been their adaptability. In this climate of uncertainty, business owners are digging deep and finding ways to weather the storm.
“The pandemic has created an operating environment like we never imagined, but companies have quickly shifted from a ‘squatting’ mindset to looking for opportunities, to creativity and to quickly adapting to changes in business. the world, ”says Jo Durcan, Head of Central Auckland, Partnership Banking at BNZ.
“Opportunities arise in times of challenge and innovation comes from duress. We have seen many companies adapt during the pandemic to become stronger and more resilient than ever.”
To make sure your business can adapt to and even overcome the pandemic, try following these five tips:
Develop an early warning system
Obstacles in the road can be difficult to predict, so have alarm bells in place that can allow you to sort out problems and trigger action before they get out of hand.
While revenue is often the best indicator of how your business is performing, other factors such as net and gross profits, accounts receivable, and web traffic can help paint a clearer picture of what it is. have to plan for the longer term.
“The pandemic has forced companies to assess all their costs and make some very difficult decisions. Ultimately, this will result in a stronger, more profitable and future-proof business, ”said Durcan.
Create a cash reserve
If sales drop while expenses rise, your bottom line could be at stake. Having a cash reserve saves you more time to deal with what needs to be fixed.
Businesses should find extra money for “rainy days,” either by becoming more efficient or by changing the way they do things, says Durcan.
“With the international challenges of supply chains and importing and exiting New Zealand products, it has never been more important to closely monitor cash flow. “
Collaboration and partnership
Teaming up with other SMEs to work towards common goals is a good way to increase capacity and share resources, costs and risks.
In times of crisis, knowing you have the backing of other business owners can provide reassurance to both you and your customers, and many small business owners have been able to stay afloat during the pandemic by working together.
“We are seeing business owners connecting and collaborating on how they could potentially work together to ship products to overseas markets or shorten their supply chains,” said Durcan.
“They shared the cost of exposure to expensive air freight that they might not have otherwise been able to afford.”
Access new markets
Extremely challenging environments like bottlenecks are often the very time when companies are presented with opportunities to market to new customers or to diversify their business model.
“Companies that quickly recognized and reacted to opportunities to expand or create new markets have really prospered,” said Durcan.
Finding new customers can seem overwhelming, so try this plan for new markets and customers to help you organize things.
Protect what you have
Existing customers tend to be more valuable and easier to sell, so protect your customer base by building on your strengths and staying competitive.
Durcan advises SMEs to harness the power of digital tools such as social media and e-commerce to engage customers directly and gain on-site feedback on areas such as products and customer service and determine what they are for. want their business to be known.
“People are spending more time at home and more time in front of their screens. They are looking for ways to connect and engage, so how can your business be a meaningful part of their life? “
For more information on how to move forward in an uncertain world and how BNZ makes business banking easier, visit www.bnz.co.nz/business-banking
The opinions expressed are those of the person or entity concerned. They do not necessarily represent the views of BNZ or its related entities.
This article is for informational purposes only; it is not financial, legal or other professional advice. If you need assistance, please contact BNZ or your professional advisor.
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