These potential strategies are not universally applicable to every business, are not surefire solutions and may not be realistic for every company, but they are strategies that some could pursue to increase sales or reduce expenses when things get tough.
When there’s a lot of economic uncertainty across the board, many consumers and businesses are understandably skittish about making investments or big purchases, all of which carry some degree of risk. Warranties, guarantees and return policies are essentially insurance policies that reduce those risks. People are more likely to buy a product when they know:
Not every business has the flexibility to offer this safety-net incentive, but it can help make risk-adverse customers more comfortable with purchasing a product or service.
The coveted “super consumers” are customers or clients who you know you can rely on for purchases during normal times. Some of these customers may be pulling back on their purchases (or vendor commitments for B2B businesses) while dealing with their own coronavirus cashflow issues.
As a business, you may be able to offer pricing incentives that are too good to pass up. If it would be an outstanding deal under normal circumstances and the service or product you’re offering is something your customer would benefit from or use when life stabilizes, the appeal of the offer may exceed their risk adversity.
Consider a pizza restaurant offering a free large pizza to anyone who buys a $20 gift card. Customers know they will likely use the gift card anyways, or at the very least give it to someone as a gift, so why not get the free pizza? If a consumer sees an obvious win-win on a product they were likely to buy anyways, it may motivate them to make a purchase, or spend more than they were initially planning to spend to get the “deal,” despite tight finances.
For businesses that are completely shutting down fulfillment operations and going on life support, marketing is an obvious place to cut costs. But not every business is going completely dark, and not every marketing campaign is intended to drive phone calls today. Certain types of campaigns, like Google ads, may not be necessary if you’re not taking any new jobs right now. Other campaigns, like SEO and branding campaigns that build over time, may still be worth keeping.
Business owners hopefully know which of their marketing efforts are most effective. If mailers and social media provide the lowest ROI, cancel those for the time being.
When times are desperate it’s sometimes necessary to think outside the box on customer acquisition efforts. Is it possible for your business to offer a free trial period to relevant customers who may not have used your products before? Zoom, for example, is offering elementary school and high school educators free use of their platform, and will likely convert many of these accounts into paying users.
Business owners may want to take this opportunity to think about previously unreached demographics or verticals that could potentially benefit from their products or services.
Retailers, hospitality businesses, repair shops and all sorts of other service providers regularly have to purchase supplies or products. Some business owners are constantly reassessing their supply costs, finding better, more competitively priced vendor options and adjusting the volume of their purchases based on customer demand and business performance.
Not every business owner has the bandwidth to perform these tasks as often as they want. If you think your inventory management could use an update or changing circumstances during COVD-19 have altered the way your customers buy your products or use your services, now is the time to adjust inventory accordingly.
If your business is suffering, chances are your vendors are as well. There may be deals that can be renegotiated as B2B suppliers seek to lock in longer term contracts that could be favorable to you.
Many Phoenix-area small business owners who handle their own QuickBooks, payroll and business loans end up missing out on potential efficiencies and savings, not from lack of trying but due to understandable inexperience.
Entrepreneurs start a business to pursue a passion, not analyze a half dozen different benefit plan options, implement cost controls or research tax planning strategies.
H&H Accounting’s business is taking these issues off your hands. We strive to provide smart, efficient solutions that save your business money while giving you peace of mind.
COVID-19 has given everyone sleepless nights, but with H&H Accounting you can at least rest easier knowing your payroll is being properly handled, your books are accurate and you’re not overlooking tax or administrative savings opportunities.
Call us at (480) 561-5805 to consult with an experienced Phoenix CPA today.
