1. Act decisively
Being decisive is often far easier said than done, as it takes foresight and courage. But if you can resist the urge to become defensive, your business will be in a better position to take advantage of the opportunities that present themselves.
"There is the risk you cannot afford to take, and there is the risk you cannot afford not to take." Peter Drucker.
It implies embracing change or even doing things, like investing more in marketing and equipment. Don't be afraid to challenge your operational processes. If you're a manufacturer, for example, challenge your lead time assumptions, question whether safety stock calculations still reflect the current situation and identify customers trends. Also, digital transformation has been a trend for many years. But many companies have been reluctant, or slow, to take up the challenge. Digitally mature companies are reporting higher levels of profit (Deloitte). You can harness your data to challenge existing assumptions. In times of uncertainty, there's a golden opportunity for you to try new approaches.
2. Prepare contingenciesDevelop clarity on your goals and objectives, and how you'll achieve them. Have contingency plans for scenarios and responses when these cannot be achieved. Anticipate opportunities that might present themselves and threats to cash flow, such as losing a large customer. In short, fail to prepare, prepare to fail.
3. Protect your cash flowIn times of uncertainty, cash flow is the lifeblood of your business. You can improve your cash flow by making sure invoicing, payables and receivables are operating efficiently. Investigate alternative financing options. You can open a new line of credit, even if you don't need it immediately. A potential source of extra funds will put your business in a stronger position to take advantage of unexpected opportunities.
4. Protect your supply chainIn times of uncertainty, there's always the risk of delays, tariffs and the like. Outline the risks in your supply chain, taking into account new regulations or anything else that will affect your supply chain. Look at your suppliers and consider whether you could add other suppliers to your list. If you are too reliant on one supplier, you may put your business at risk if they go out of business, or increase their prices.
5. Protect your customer baseWhen times are challenging, you must protect your customer relationships. Keep in touch and listen to their concerns. Snacks.com and other companies, took the opportunity during the pandemic to sell direct to consumers, circumventing their traditional supermarket channels. If you're a manufacturer, in particular, think of new ways of working with your distributors. Just as much as you want to protect your supply chain, you are their supply chain, so make sure they feel valued. Also, look to spread your risk if you rely on one customer too heavily.
Most businesses have the tools and capabilities to weather even the toughest of storms. However, without leadership and resolve it's unlikely businesses will survive. It takes decisive action to grab the opportunities and place your business in a strong position to thrive once the crisis is over. In the timeless words of Winston Churchill - Never let a good crisis go to waste.