By Erica Wolfe-Murray
With the world of work hesitantly emerging from behind closed doors, most SMEs are stepping out into a changed trading environment. Some have experienced booming trade over the last three months, others will have faced stark decisions about continuing their business. All will face uncertainty to a greater degree as their client base questions spend in a recessionary market. Growth in the months and next years ahead may be tough but is absolutely possible.
Here are a few pointers to start you off…
- Ensure you maximise your COVID-19 financial support entitlement
Even if you went into lockdown with a cash cushion, taking out a CBILS or BBB Loan might make sense. For smaller companies the latter offers cheap money that can help you pivot, develop new products/services, even out bumpy cash flow. It can repay more expensive debt and loans. It provides liquidity. If you don’t think you’ll need it to call on it, put it in a separate account as rainy day money.
- Check out whether you qualify for an HMRC R&D Tax Credit
In 2019 over 14,000 new applicants received a tax or cash credit for their R&D spend. If you’ve spent money trying to ‘resolve a scientific or technical uncertainty’ within your business, creating a new product/service or changing/modifying an existing one – whether you were successful or not – you may be able to claim. Tax credit covers qualifying staff time, overheads, materials, external support. Most SME claims were under £50k, very many under £5k and can cover the past 3 years. If you’re developing new products/services this year, apply in advance for pre-approval.
There’s lots of useful advice on Gov.org.uk – and you could get a cash credit.
- Talk to your clients about their changing worlds
To ensure your future success, you need to harvest as much information as possible now about how clients, contacts and your networks view the next months and years. How will their businesses be adapting to market contractions and changes? This is happening on the fly, so regular conversations are vital. What do they see, what trends are they on to, how are their worlds re-focusing? All of this is critical research for you to absorb and utilize, if needs be, to re-frame your offer.
- Scrutinise your business for under-used actual and intellectual assets
Most SMEs have reserves of under-used and hidden assets. Their knowledge base is extensive, their data has potency, their resources are often focused to their core offer overlooking value to new, emergent audiences. The adage about ‘when life gives you lemons, make lemonade’ needs to be applied now.
By really mapping your assets thoroughly, you will see what you have in your business ‘store-cupboard’ – all of which can be re-purposed inventively to develop new commercial products and services. I’ve yet to meet a business – of any size – who couldn’t adapt their assets to drive new revenue streams.
- Up-skill your team
If you have staff on furlough, encourage them to develop those skills your business might need in the months ahead. Skill and learning development for business needs are allowed under furlough guidelines. Do you need up-dated marketing capability, better supply chain/procurement practice, leadership methodology, improved HR systems? Agree a plan with your team so everyone comes back with new knowledge to contribute to the business to aid your growth ahead.
- Can you widen your revenue models?
An easy growth win is to review your revenue models. The ways individuals and companies buy changes continually. Just a few years ago no-one would have thought a shaving essentials subscription model would fly, but it’s a model now replicated across many regular purchase markets.
If you are stuck in a rut earning revenues in just one or two ways – can you widen this? If you’re uncertain how – just count the ways you are paying your personal and company suppliers now. From the moment you get up, check your phone, turn on the tap to fill the kettle to paying your rent, mortgage, tv content etc. You are already involved with countless revenue systems. How can you apply some of these to your business?
- Don’t just go it alone – collaboration makes sense
Going for growth is an outwardly focused challenge. With the different opportunities and difficulties facing your business over the next months – could collaboration with new partners offer you a route to potential markets that benefit both parties? Could it pivot your service offer in new, lucrative ways? Talk this over with your team – who do they identify as a forward-looking organisation who offers interesting potential alignment? Open dialogues with interesting parties now.
As companies have gone through lock-down, furlough and WFH, there has been distinct phases including shock, pragmatism, containment, management and now we are in the forward-looking opportunity assessment, re-framing and possible growth period. You need to take the lead and ensure you and your company emerge ahead by adapting and innovating to the world you step into.