In today’s economy, businesses face a challenging landscape that demands strategic decision-making and careful evaluation of risk tolerance, market positioning, and growth potential. While some companies are adopting a cautious approach, others are seizing opportunities to capitalize on a bullish market. In fact, eight in ten CEOs say building new business is a top-five priority despite heightened economic volatility, according to a recent survey from McKinsey.
This month at a Portland Business Journal event honoring the 100 fastest-growing private companies in Oregon, we saw first-hand how businesses can enjoy remarkable growth and demand in our current economy. The forward-thinking companies coming out on top have carefully analyzed market trends, identified untapped opportunities, and aligned their strategies with the evolving needs of consumers. They’ve showcased the adaptability and resilience required to navigate the turbulent economic waters and positioned themselves to thrive amidst uncertainty.
To follow their lead—or to ensure continued success if your business is among the fast-growing—tap into these seven tactics.
Prepare for anything and stay open to new ideas.
The economy is constantly changing, so it’s important to be prepared for anything that comes your way. This means having a solid financial plan in place and adapting your business model to the market as needed. This may require restructuring your operations, optimizing your tax strategies, revising your marketing program, evolving your product or service offerings, or identifying new revenue streams. Successful businesses are always innovating, but they also keep their eye on emerging trends, regulations, and industry developments to get ahead of market challenges and make proactive moves instead of scrambling to adjust when it might be too late.
Keep a close eye on cash flow.
During uncertain economic times, staying focused on cash flow is key. Cash flow is the lifeblood of any business, providing the necessary liquidity to meet financial obligations and seize opportunities. By closely monitoring inflows and outflows, you can gain valuable insights into your financial health and make informed decisions. For example, if you identify a potential cash shortage in advance, you can take proactive measures such as securing additional funding or implementing cost-saving strategies.
An organized accounting system can help you stay in the know about your cash flow by tracking sales, invoicing, and expenses. Using the right tools and processes will also help you chart valuable metrics, like profit margin and burn rate, that can clue you into whether your business’s growth will be sustainable or short-lived.
Know when to seek outside help.
If you’re growing too fast to plan ahead and maintain a pristine accounting system, those are two signs it may be time to bring in the help of an accounting firm. When you work with a team of professionals, you can tap into their years of experience working with other businesses in your industry through various economic climates. At Perkins, we look at the business lifecycle as a journey and are excited to be there for you every step of the way. In fact, we have a suite of services specific to emerging businesses that includes business coaching, business development strategies, business intelligence, and business valuation, along with risk management, strategic planning, and tax consulting—just to name a few.
Dedicate time to taxes throughout the year.
Don’t put taxes off until spring. If you’re a new company, it will likely take several years to get a sense of the nuances in your company’s tax situation. By starting early in the year, you’ll leave plenty of time to learn about regulations specific to your industry and geography, identify the best tax firm for your business, and ensure your financial records are in tip-top shape. For more advice on making tax season less stressful, check out our recent blog post, Foresight Beats Hindsight at Tax Time: Seven Ways to Make Filing Faster and Easier in 2024.
Invest in your team.
Your company’s culture directly contributes to your business’s bottom line. As you grow, invest in hiring the right people, providing the benefits and training they need to do their jobs well, and cultivating a positive work environment. Factor these elements into your growth plan, and don’t let growing quickly become an excuse for candidates who are less qualified or not a good fit for your company’s culture.
Also, check in with your current employees to see how they are handling your business’s rapid growth. Are they working late, missing deadlines, or feeling burnt out? They could be overworked. Revising your staffing plan may help alleviate some stressors and ensure all aspects of your business, from customer service to accounting to inventory, are properly managed by a team of high performers. Keeping your current workforce happy could offer cost savings to your business compared to hiring new employees in an economic climate marked by ongoing labor challenges.
Prioritize customer service.
If your business is growing steadily, but you’re receiving negative feedback or not seeing repeat customers, you might not be adequately staffed to provide the best customer experience possible. Review customer feedback to identify patterns or specific pain points, such as long wait times for product restocks or frustration with the chatbot on your website. This way, you’ll know exactly where to channel your resources to help address the issues that could be holding you back.
Customer service is especially important during an economic downturn when competition intensifies as businesses vie for a smaller pool of customers. Even if your customers are cautious about spending with you now, maintaining their loyalty means they’ll likely do business with you when economic conditions improve and recommend your business to others along the way.
Focus on core strengths.
If your business is looking to grow during periods of economic uncertainty, it’s important to focus on your core strengths versus attempting to be everything for everyone. By zeroing in on what you do best, you can operate more efficiently, deliver superior products or services, and meet customer needs more effectively. Leveraging your core competencies and capitalizing on your unique advantages to stand out in the market helps you maintain a competitive edge while optimizing limited resources.
If you’ve hit your stride and want to ensure your business’s continued success, let’s talk! Perkins offers a collection of services specifically dedicated to business expansion. Whether you’re eager to broaden product lines, enter new markets, effect a merger or acquisition, or expand across borders, we’ll help you get there.
Contact us today to stay a step ahead.