Jan 14, 2016 Robert Kaiser Business, economy, Aftermarket
Robert Kaiser
Now that the all the festive and new year social and holiday festivities are behind us and we are back at work, it is necessary to reflect on 2016 as the start of a new business year. Hopefully we have all had a really good rest and are able to think about our businesses in a refreshed state of mind.
If one looks at the circumstances surrounding us, it is easy to be overwhelmed by the negativity that is evident just about everywhere. The knowledge that South Africa is not the only country grappling with disruption and upset, but that this is an international phenomenon, is cold comfort when you open the doors of your business to 2016 and wonder how the heck you are going to make ends meet!
Fortunately it is so that despite a negative business climate there are always positives. If one does not waste energy on the negatives and instead focuses on the positives, you have already won half the battle - there are always opportunities waiting to be discovered and exploited.
Here are a few thoughts that may be of value to you in getting your business ready for the 2016 business year:
Get rid of negative perceptions. Modern business is driven more by perceptions than ever before. We see the effect of perceptions daily in the value movement of share prices, currencies and a host of other volatile factors. It is easy to fall victim to negative perceptions, which could in turn affect your business outlook and decision making processes. Refuse to be influenced by negative perceptions. If you are a vehicle dealer, remember that, despite a decline in vehicle sales, a great number of vehicles are still being sold every month and strategizing to get your piece of the pie is what should be occupying your mind. If you are active in the automotive aftermarket, the good news is that the average age of the vehicle car parq in this country is still growing, spelling opportunity for the spares, accessories, vehicle repair, tyre and associated sectors. The collision repair sector is all but recession proof! The challenge is to ensure that one does not fall victim to overtraded market conditions. Excellent customer service and quality of workmanship will ensure profitable survival.
Budget and stick to it! A well-managed business will have a realistic budget of projected income and expenditure. Your budget is your work programme for the year and you should stick to it, deviating only when unavoidable and unforeseen circumstances force you to do so. An unexpected expense should be balanced by an adjustment to the income side to keep the integrity of your work plan in place.
Check your cash position and the cash flow requirements. Ensure that cash flow is sufficient to meet obligations. This could be an issue especially at the beginning of the year, when cash-sapping December bonus payments and other end of year expenses have taken their toll. Cash flow should be scrutinised on a daily basis, it is that crucial!
The Debtor’s Ledger. This is a crucially important business asset that looks nice on a balance sheet but not of much use if payments are not made timeously, impeding your cash flow. Some debtors may have delayed payments to you to support their own cash requirements over the festive season period and in order to address this, credit control should be intensified.
Credit Control. The importance of on-going effective credit control in business does not even have to be debated. It is an imperative, as important as focusing on new sales. Neglect it at your peril. A commitment to ensure effective credit control in your business could be one of the best Business New Year’s Resolutions you can make!
Training. Making sure that your employees are exposed to training, whether it is to acquire new skills or to receive further training in new trends and developments in their fields of expertise to keep their knowledge and skills relevant. This will ensure that your business stays ahead of the game in your industry sector and enhance your competitive position market share. At the same time you could ensure that you recoup any refunds/subsidies for training undertaken which may be available from the Merseta. Get your own back!
Staff Motivation. If a team spirit is not yet part of your business culture, you should not let this New Year pass without giving serious consideration to the inculcation of a true team/family spirit. This is an aspect that deserves volumes of consideration and thought, Nothing can beat a situation where there is a true, genuine team spirit to foster a sense of belonging, of being a valuable asset to the business and being treated with dignity and cared for. Your business will reap the benefits.
Marketing and Communication. Be sure to consider your marketing strategy for the New Year: you could have the most amazing business offering but if no one knows about it, you may as well close your doors! Consider how you are going to apply your marketing budget: advertising, both print and digital, choosing the channels and publications where you will get the most advantage for your spend and participation at trade shows are all essential elements of a balanced marketing and advertising strategy. Effective customer communication is a must. Have a critical look at your website to ensure that it still conveys the image (remember the perception principle?) of your business that you would like it to, that it is relevant, the standard of grammar is impeccable and that contact details are up to date and easy to find and utilise. Websites are so important but so easily neglected. Make on-going website administration part of the portfolio of a senior member of your staff and remember to check on this regularly!
Reception, physical and telephonic. This is where customers and potential customers interface personally with your business; are these crucial reception functions in capable hands that are professional, and an asset to your business or are they letting you down? Perhaps it is time for some critical evaluation and, by the way, do get rid of the automatic answering service if you can, it is an awful system meant to save you money and time but it could cost you dearly in the long run!
These are only a few thoughts on getting your business ready face a challenging 2016 and it remains for us you wish you: Happy New (Business) Year!
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