How To Shelter Your Business During An Economic Storm

With South Africa's GDP growth forecast to be just 0.7% for 2019, most businesses are taking severe strain. To prevail in this difficult economic climate, each business will need to ensure that it is running an efficient operation.

- Athabile Jojo

Here are some ways that small and medium businesses (SMBs) can reposition themselves to succeed in a downturn economy.

Review your services and operations

To make your business more resilient, start with a review of the revenue and profitability of every product and service line you offer. The effect of an economic downturn can be counterintuitive, so always look carefully at the hard data. For example, you should look at how currency movements or rising electricity prices affect your margins to see whether an offering that did well in a healthier economy remains commercially viable.

Conversely, you might find that demand for certain products has risen against the backdrop of a weak economy because customers are seeking lower-cost alternatives. You may find it better to more aggressively market the cheaper option to customers who can no longer afford the top of the line offering in your product range. In some cases, you can achieve significant cost savings by streamlining your product and service line.

Try to avoid cutting headcount...