Rising interest rates and volatile markets have certainly caused quite a bit of concern for Canadians over the past several weeks—but that doesn’t mean there aren’t silver linings to be found in the current economic storm. In fact, many business owners across the country have found opportunities to rebuild, refocus, and even expand their businesses in the current climate.
Here are just a few ways that well-positioned owners can leverage this downturn to launch their business into an upswing.
Take advantage of surplus inventory.
It’s no secret that supply chains across almost every industry were hard hit by the pandemic. Spikes in online ordering and unexpected booms in industries like medical equipment, food service and home improvement caused unprecedented demand that supply chain infrastructures weren’t equipped to handle.
Now that these supply chains are starting to sort themselves out, the mass quantities of inventory are being delivered to distributors and retailers just as demand is starting to wane. The long and short of this means: manufacturers and retailers have an excess of inventory that’s starting to age–which means they may be willing to part with bulk orders at a discounted rate. Pick up the phone and contact your vendors to see if this is the case for them. Helping them unload their aging inventory could mean cost savings for you and your business.
Focus on your client relations.
If you’re a service provider that’s currently feeling a slow down in your day-to-day, use this as an opportunity to refocus your efforts into nurturing client relationships. At the end of the day, all businesses serve some sort of customer even if they’re other businesses. Take advantage of some of your new found time to invest in your most important asset: people. When things start to pick up again, they’ll be much more likely to continue, or even increase, the amount of business you do together.
Keep an eye out for acquisition opportunities.
Although COVID certainly took its toll on many businesses, and the volatile economy continues to put pressure on others, the reality is that folding and struggling business open up certain opportunities for well-positioned entrepreneurs and owners. There’s currently a large amount of real estate that is newly vacant as well as commercial assets that are priced to move. Similarly, businesses that are looking to raise capital to stay afloat are opening up to the idea of merging, partnerships and even acquisition.
Surround yourself with the right people.
Just as important as when your business is in the red, maintaining consistent communication with key partners is integral to maintaining any upswing you may be experiencing at the moment. Aligning yourself to smart people that you trust isn’t just a tactic to turn hard times into manageable ones–it’s also key to growing good times into great ones. Keeping close and strong relationships with your accountant, lawyers, manufacturers and your banker are always important no matter what state your business is in. Which leads us to our last point.
You don’t need to be banking to speak with your banker.
A lot of business owners only communicate with their financial institution to process payments, cash cheques, or conduct other day-to-day banking. Few businesses take full advantage of this relationship which means they miss out on free financial advice that could be key to consolidating debt, deploying cash to increase capital, or even personalized tactics to grow their revenue and personal income. Checking in with your financial advisor or institution even when you’re not just banking could put you on a new financial path that’s not only more stable, but one that’s primed for growth.
Connect with a member of our Business Banking Team and we can put a plan together that makes sense for you and your business.
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This article is provided for general information purposes only. It is not to be relied upon as financial, tax, or investment advice or guarantees about the future, nor should it be considered a recommendation to buy or sell. Information contained in this article, including information relating to interest rates, market conditions, tax rules, fees, and other investment factors are subject to change without notice, and Coast Capital Savings Federal Credit Union is not responsible for updating this information. All third-party sources are believed to be accurate and reliable as of the date of publication and Coast Capital Savings Federal Credit Union does not guarantee the accuracy or reliability of such sources. Readers should consult their own professional advisor for specific financial, investment, and/or tax advice tailored to their needs to ensure that individual circumstances are considered properly and action is taken based on the latest available information.