Ways SMEs can recession proof their businesses

DURBAN – Despite the country falling into recession, coupled with a dim economic outlook, it is not all doom and gloom for small businesses.

Andiswa Bata, FNB Business Regional Head for Gauteng South West, said that for many small businesses the outlook for the year ahead seems bleak due to a lower forecast for economic growth globally, challenging local trading conditions owing to inconsistent power supply, currency volatility and rising operating costs, amongst several factors. However, opportunities still exist for SMEs who are agile. 

Bata unpacks simple strategies that businesses should consider to navigate economic headwinds in the short to medium term:

Cash buffer 

A cash buffer can help your business to take advantage of opportunities quickly, survive unexpected knocks and remain competitive when price can be the difference between winning or losing market share.
 
“There may even be an opportunity to acquire/merge with a competitor or another company that complements your own offering. Having spare cash sets you up as a potential buyer, at a time when business valuations may be attractive. If the pie isn’t getting bigger, seek to secure a larger slice,” said Bata.