Tips for running a successful business in the current economic climate

Our recent research found the rising cost of living has made it harder for 65% of SMEs to run their business – with 87% saying the past winter has been the ’toughest in memory’. We also uncovered the different steps businesses are taking to stay successful. We spoke to Sushil Raniga, from East London jewellery store Bees, about some of the steps he’s taking to manage rising costs and changes in shopping habits.

So, what can you learn from Sushil and other business owners?

Negotiate with suppliers – Nearly every business is seeing an increase in their costs. It might seem impossible to negotiate with suppliers, but remember they’ll be keen to keep you as a customer. Ask them about possible discounts, changes in payment terms, flexibility in minimum order sizes and any added value they can offer you. Don’t be afraid to negotiate with them.

Trial different opening hours – You might be noticing a change in footfall, with times of the day (or days of the week) much quieter than before. This gives you the option of reducing your opening hours without risking loss of customers. There’s other things to consider though, such as the implications of reducing employee hours, so make sure you know what your options are.

Get more involved in the local community – Nearly 50% of our respondents told us they were taking steps to help their local communities. From providing food and drink to those struggling with cost rises, to donating to local food banks or local causes, businesses owners are getting more involved in supporting their community. As consumers change their shopping habits, this could make customers more loyal and aware.

Be more active online – There’s a few ways of doing this; from building your social media presence to selling online through your website. You could even build an app for your business, making it easier to push out offers and promotions to your customers. Being active online will help you reach a wider audience, especially if you can start selling to customers further afield.

Manage your overheads – Review all of your overheads and look at any costs you could cut. You might unearth subscriptions or regular costs you’d forgotten about, or find cheaper deals with other suppliers. Some of the businesses we spoke to had started using buy now, pay later options with suppliers to help spread cost more evenly. You could even join forces with other businesses and benefit from bulk buying goods and services.

Be the face of your business – Telling your story, and becoming the face of your business, can help attract and keep customers. You can build a personal connection with them, in store and on social media, and get them to shop with a business they know rather than an anonymous brand or chain. You’ll get to understand your customers better and are more likely to get testimonials and referrals.

Review your prices – Think about the impact increasing or reducing your prices will have on your customers. If you feel you have to increase prices, consider how you’ll communicate this to your customers. Maybe you could also launch a loyalty scheme to reward them for still shopping with you, whilst also reducing some of the impact of a change in pricing. Review your products to see if there’s any you can reduce the price of, or where you can offer discounts and other incentives.

Diversify – Think about new product lines you could help you attract new customers. We saw this during the pandemic, where restaurants launched new ‘dine at home’ menus to maintain sales. Perhaps you can provide a personal shopping experience, or bespoke products and services that command a higher price.

For more guidance on how to help your business thrive have a look at British Business Bank’s guide to building business resilience to help get your business onto a firmer footing.