Weathering the Economic Storm - Part 5 - Business Relationships

This is the fifth and final entry in the series.  To review, we’ve covered:

1. Corporate Dashboards

2. Review Profitability

3. Review Costs

4. Cash

5. Business Relationships

Now in part five, I’ll discuss improving your business relationships and why you should care.

Work on Your Relationships

During difficult economic times, it’s especially important to try to improve your business relationships.  Pay attention to the needs of your larger customers.  Schedule face-to-face meetings to review their needs and your ability to solve their problems.  If you can find ways to cut costs on your side and serve them more efficiently, you both win and they’ll appreciate your being proactive in the relationship.  Your customers are probably doing the same kinds of analysis and reviews of their situations as you are doing in your business.  They want to find ways to cut costs and improve cash flow.  Don’t let them go away because you didn’t take the time to talk with them.  Even if you only have a face-to-face status update or take them to lunch for a friendly chat.  They’ll appreciate your concern and attention.   

But don’t stop with your customers, talk with your vendors.  Letting your vendors know that you’re looking for ways to improve delivery reliability and reduce on-hand inventory and costs will open up discussions for way to improve your working relationships.  It could be that they’re doing all they can do with what they have to work with.  However, maybe a slight change in the rules by which you operate give them flexibility to work with you on some items that are important for your business in exchange for your helping them with items that help them in their business.  You’ll never know where there are even possibilities unless you talk.  Don’t assume that they aren’t interested in working with you to find way to be more efficient together.  On the other hand, if they’re not interested in finding way to work together more efficiently, you probably need to look for another vendor.  

 Finally, talk with your financial partners.  Banker, insurance brokers, regulatory agencies and other business partners are all interested in your long-term survival.  Most of these groups will share information about the industry and ways to improve your operations to achieve more profitability, lower costs and higher efficiencies and safety ratings.  A higher quality business is a more profitable business.

Summary

Running a business is tough, even more so during harsh economic times.  Engage your employees and management to look at every aspect of your operations to make improvements, increase efficiencies and raise quality.  Measure your progress as you make changes to achieve continuous improvement.  Focus your financial eyes towards the cash and constantly strive to bring your customer and vendors closer by adding value to your relationships.

If you need help in any of these areas, give me a call.