I had a Yorkshire mother – and they can give the Scots a run for their money when it comes to being frugal. She recycled and reused long before it was a thing and always found ways to make a little go a long way.
Now we’re in a different age and sustainability is important because if we don’t pay attention our throw-away society will do the environment damage. But the critical factor today is money.
Prices are rising – energy, fuel, transport costs – and strikes for more pay have been popping up all over the place as people are desperate to be paid a living wage, not just barely enough to scrape by. Inflation and interest rates are soaring – it all sounds like doom and gloom for business people.
Of course, your running costs will go up. Even if you’re a home-based worker you’ll need to keep warm this winter and you need food to survive. Business costs are going up too as part of this upwards spiral. So practically, what can you do?
Audit your outgoings
Get a spreadsheet out and list all your business outgoings – monthly and occasional. Do the same for your personal expenses. Now you’ll have two figures – one for your business and one for your household.
- What are you paying for that you’re not really using? Cancel those payments right away!
- What are you paying for and using, but may have a lower cost alternative? Get on your research and make changes.
- What are you paying for and using, but you could use better? Take action – even if it takes a little time to get it organised.
Review your income
With your new awareness of what you need for you and your business to survive, your next step is to ensure that income exceeds outgoings. Logic, but something not everyone checks on regularly. We’re not talking about the end of year balance sheet (although that can be useful), but a simple monthly check and balance process.
If you’re on a knife edge or not confident you can keep ahead of the game it’s time for action.
It’s not about expanding by 2-3% – you need to stretch your imagination. So, for example, if you need £5,000 a month to pay all the business bills AND yourself enough to live on, adding an extra £150 to your income won’t make a massive difference and you’ll probably just do more of the same.
Add a nought and you’ll need to think differently. So if you want £50,000 a month – what strategies, plans and tactics will you need to achieve that?
Don’t worry about falling short of your target – as the saying goes ‘aim for the stars and you may reach the moon’. It’s not about success or failure, it’s about thinking in a different way.
When was the last time you asked your customers (and potential customers) what they really wanted? As the economy changes, what people value will change too. Invite your customers to share their challenges with you so you can ensure that whatever you deliver to them ticks all their boxes.
There may be huge untapped potential you haven’t explored yet.
Also you may find it’s time to discontinue unprofitable products/services.
Even in the luxury market place customers’ expectations change – even when money isn’t an issue.
The secret of a successful business is diversity, flexibility and the ability to see what’s needed and lead the field.