Battle for survival: How to prepare your business for the recession

Interest rates might be starting to flex in the right direction, promising improvements in time, but the Bank of England continues to warn that the UK faces its longest recession since records began. The business forecast is more uncertain than ever. Everyone talks about tightening their purse strings and the importance of prioritising, but how can this be applied when it’s your business at stake?

As credit availability tightens and short-term interest rates tend to plummet, businesses facing the impact of recession are forced to address areas where they can save. In a nutshell, as companies cut costs, unemployment rates rise, reducing consumption rates and causing inflation rates to go down.

Through assessing the health of your business, implementing change and maximising talent, you will be on track to keeping your business afloat and being ‘recession ready’.

Steps business owners can take to ensure their business strategy will withstand the recession:

Value your staff – Make sure your workforce is as effective as it can be, support your employees and make it a place that people feel valued and rewarded in, especially in times of uncertainty. Ask for their input in decisions and changes. If possible, offer affordable benefits and incentives. Through creating a healthy work environment, where teams work together and give it their all, your business won’t just survive, it will also thrive.

Securing finance – Having an up-to-date and realistic business strategy will also help when it comes to finance. This will show financiers that you have a path to profitability and growth, giving them the confidence to invest or lend you the money you require. Transparency is key in securing finance, as lenders and investors want to know you are aware of the risks involved during times of economic hardship such as recession.

Manage your cash flow – Without stating the obvious, staying on top of invoices and making sure that you aren’t going to have periods of being without, is crucial. Prioritise prompt and punctual paying clients over those who pay late and need to be chased up. After all, time is money! Your financial status is dependent on having your finger on the pulse, having a steady income and knowing what’s coming in and going out at all times, it goes without saying that it’s imperative to have the funds to cover unforeseen circumstances such as a rise in supplier costs or building costs.

Improve your website – People don’t have the time to trawl through websites looking for answers. Make sure it’s accessible, SEO friendly and gives the visitor what they want. A user-friendly website done right,  is also a surefire way of generating new clients.  

Go above and beyond for your existing clients – Your clients chose you, so give them reasons to stay and to spread the word about your business and its services. Not only does this put you at the forefront of your field, but through staying true to your word and practising what you preach, this will generate new clients too.

Hone in on your company’s strengths During a recession, it’s often necessary to do more with less. It’s better to be exceptional at one thing than mediocre at several; find the strengths of your business and maximise them. Champion your staff and products and focus on boosting efficiency and productivity, whilst streamlining.

How can we help you?

As troubling as the impact of recession on your business is, it isn’t all doom and gloom. Of course, entering a period of recession can feel like venturing into the unknown. However, it can also be viewed as a welcome opportunity to review your finances and the day-to-day running of your business. By putting positive changes in place now and having a robust and adaptable business strategy to get you through the storm, you will be in a much stronger position once it has passed.

Our robust team of lawyers is here to offer advice and alleviate the pressure when dealing with the uncertainty of the recession in areas such as corporate governance. We have practical expertise and extensive experience when it comes to corporate governance and compliance for private and public companies and offer a full suite of services to support Head Office, General Counsel and Company Secretarial teams. 

Our employment lawyers cover all aspects of employment law, from advisory and transactional matters to disputes and settlements. We provide employment law advice that is pragmatic, concise, and responsive to the needs of your business especially during these unprecedented times.

At Arbor Law, we understand how worrying times of recession are for you and your business. We have practical expertise and extensive experience when it comes to corporate governance and are here to help with our expert team of corporate senior lawyers, offering second-to-none expert advice to guide you through these uncertain times with confidence and ease.