Wednesday, 22 April 2009

Maximising Business In The Recession

Today is Budget Day and I must admit, I would not like to be in Alistair Darling's shoes. On a day when debt rose faster than anticipated and we now owe over half of our GDP, he will be proposing that we raise spending and borrowing again while swooping in on our savings by likely removing the tax relief on pension contributions for those earning over £40,000 a year. It's a budget all about the here and now while deferring all the bad news to some years down the line.

It will be a critical day for businesses up and down the land. The failure of initiatives like the Enterprise Loan Guarantee Scheme to get a semblance of normality into credit has hit small businesses hard and unemployment rose sharply again last month.

It's hard to call but it seems to feel like we are now at the deepest point of this recession and it's likely most businesses are feeling the hardest pressure now. Many businesses will be finding sales static or dropping, cash tight, stock an issue and costs always pressuring. It is a time when cost cutting comes to the fore and that invariably means people going.

Surviving and Thriving

Recessions are mean beasts and are no respecters of heritage or past glories - look at MFI, Woolies and Viyella. It has been a vicious and fast-acting recession as credit has also dried up in the after math of the credit crunch.

However, now is the time of potential new opportunities and a chance to set up your business for a new future. It will require bold thinking, fundamental changes and even some heartache but now is the time to radically get to the core of your business and make changes to make sure the future is better.

There are opportunities out there. Cash may be tight but companies which have plans, a sound strategy and opportunities in their business can gain access to cash - it will be all about demonstrating these ideas, how your business will change to grasp them, how management is capable of embracing the changes and the opportunities, understanding what is required in terms of new resources in order to access the opportunities and if management is flexible to new ownership or structures.

For many businesses, their focus will be purely on cost savings and this will take the focus away from the opportunities. And this is often a symptom of short-sighted management who can manage upside but not the downside. It may mean some fundamental changes in key people, ownership, cash and debt structures and definitely in business focus. It is not for the faint-hearted.

As a gratuitous plug, this is what my business is all about. Call it business turnaround, call it business change, call it what you like, but Calx Europe is all about creating opportunities and tackling issues. It's all about results, so this is not consulting but practical, hands on management which delivers. It's about driving change in your business to unlock cash and profit, about finding new forms of finance or funding, finding new ownership, finding new management and talent, about marrying up new partnerships, about finding new opportunities and markets, about driving sales and people - it's about accelerating your business.

And in a recession, there is no time like the present.

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