3 Ways to Keep Your Business Afloat During a Crisis
Created on 7 July, 2024 • Scale Up Business • 24 views • 1 minutes read
In less than five years, the world has faced several crises. Starting with the Covid-19 pandemic, followed by the Russia-Ukraine war, and now the inflation crisis. Many sectors have been affected, both directly and indirectly, with businesses being hit the
3 Ways to Keep Your Business Afloat During a Crisis
In less than five years, the world has faced several crises. Starting with the Covid-19 pandemic, followed by the Russia-Ukraine war, and now the inflation crisis. Many sectors have been affected, both directly and indirectly, with businesses being hit the hardest.
However, because these crises have occurred so close together, many business owners have learned valuable lessons from each one. As a result, they have managed to keep their businesses running. In fact, some have even seen their businesses grow after a crisis.
Table of Contents
- Becoming a Cost Leader
- Building and Expanding Networks
- Investing in Human Capital and Technology
3 Ways to Keep Your Business Afloat During a Crisis
Here are three strategies that business owners have used to survive during tough times:
Becoming a Cost Leader
Becoming a cost leader involves cutting costs across the board—operational, marketing, and other business expenses. By implementing this strategy, a business can increase its profit margins, allowing for reinvestment in other areas. Alternatively, a company could lower its selling prices while still maintaining profitability, making it more competitive in terms of pricing.
The key to being a cost leader is efficiency, not stinginess. Smart business owners will invest in people who can manage costs effectively, even during a crisis.
Building and Expanding Networks
The second strategy is to build or expand networks. The goal here is to broaden the supply chain. If you were only working with a limited number of partners before a crisis, now is the time to seek out new ones. This could mean finding suppliers who offer better prices, longer payment terms, or faster delivery times.
Investing in Human Capital and Technology
Crises can weaken companies, making it essential to diagnose the performance and health of the business. For this, you need the right tools and experts. While many companies focus solely on survival, savvy business owners also think about investing in technology. This, along with human capital, will serve as leverage once the crisis ends. When other companies are just starting to recover, those who have invested in technology and skilled personnel will be ready to surge ahead.
Conclusion
In summary, surviving a crisis involves strategic cost management, expanding your network, and investing in technology and human capital. These approaches not only help businesses stay afloat during tough times but also position them to thrive when the crisis is over.