This year has been a bad year for many companies – here is how to make sure 2017 is better
The past 12 months have not been a great time for many businesses. It started with the economy struggling to recover from the effects of the double change in finance ministers, was threatened by potential downgrades to sub investment grade by the rating agencies and characterised by shocks like Brexit, the Trump victory in America, local government elections, the #feesmustfall movement and the State Capture report. The serious drought saw food prices rocket and water restrictions added to the difficulty of doing business. All these issues make buyers nervous, and nervous buyers will delay all but essential purchases.
On top of all this the South African national pastime of sharing bad news brought a mood of pessimism and resignation. We know that water restrictions and high food prices will continue well into 2017 and the ruling party will have an elective conference which could be abrasive in the coming year. What, you may ask will make this year any better than the previous one? One of the answer to that question is you. There are many things you can do to shield your business from negative external events, and to seek the opportunities that any adverse event brings.
First the bad news. Crime and corruption is not going away any time soon. The #feesmustfall protests will continue violently. There will be strikes, service delivery protests and traffic light failures. Buyers will wait for calmer times to commit to projects. Plan around this, deal with it and move on. Talk respectfully not paternalistically with your workers, listen to their concerns and dreams and do your best to accommodate them. Plan for potentially disruptive times like the elective congress and university fees protests by building inventories appropriately and offering standing order contracts to your customers to secure at least some business when things get heated. Invest in IT systems to make your business more efficient, secure information off site or in the cloud Increase standards of your product quality and your customer service levels, optimise deliveries for bad weather and traffic light failures, then get on with business. All of these have a cost, so you will need to increase sales volume or prices, make this happen.
The good news is your business has the ability to shine against competitors when adverse events affect everyone. Smart entrepreneurs can turn any event to an opportunity. Exploit uncertainty by showing potential buyers that your products and services offer a clear and immediate value proposition. Look for the products which must be purchased even in tough times. Think of the opportunities for suppliers with inventories of critical parts for their own and customers’ needs during times of disruption from strikes or protests. Water efficient products sell well when water is scarce – get or make the right products then sell that feature aggressively. Become the company that stands out, confidently and aggressively marketing your value proposition while others cut marketing budgets and reduce service levels. There are huge opportunities in any bad circumstance, see them as a challenge.
Stop complaining about how bad things are. Reality check: Golf estates with exotic housing are growing rapidly, luxury supercars are being sold by the hundreds each month. The truth is that there are hundreds of wonderful examples of South African success despite difficult conditions. Any edition of the popular business and entrepreneur journals will feature several great businesses thriving while others complain. It may be valuable to collect some of these and make a point of dropping them in to the conversation when it again turns to our national pastime of complaining. It is fun to watch the faces and stops us getting depressed in a sea of blame and anger. The time has come to face the opportunities and grab them.
©copyright Ed Hatton. All rights reserved. You may republish this article or extracts from it provided you state I am the author, acknowledge my copyright and provide a link to my blog or my e-mail address.