Rising interest rates, inflation and the energy crisis suggest the UK is headed towards recession. So what can SMEs do?
The Alternative Board (TAB), which runs leading business advisory boards across the UK, is advising SMEs to get recession ready now to survive what is predicted to be a prolonged downturn.
With peer-to-peer support central to the commercial success enjoyed by TAB members across the UK, the company has pooled together advice from its business owners who experienced the country’s last big recession in 2008.
“SMEs are crucial to the UK’s economy and account for over 53% of private sector employment, so it’s vital they ready themselves now for a potential recession,” said Ed Reid, co-owner of The Alternative Board. “We’re here to ensure our SME facilitators and the businesses they support come out fighting and do all they can to mitigate against the 2.7 million job losses experienced in the last recession. Putting clear strategies in place is imperative to maintaining income streams and protecting assets during a downturn. SMEs that invest time now in fully assessing all aspects of their businesses, cutting back where they can and readying themselves for a downturn will be in a far better position to ride out a recession.”
Top tips include:
If you have a robust product/service offering and you manage your team and your cash well then you will almost certainly come through a recession stronger.
…But be careful what you class as discretionary. Marketing spend is often cut when times are tough, but the reality is, it’s when you often need it most.
Make sure your relationships are as strong as possible and that you have a Plan B if any start to struggle.
Stay alert and seek out new opportunities.
Ensure you have funds to maintain your cash flow.
TAB has created a free Recession Ready online hub to help SMEs across the UK prepare for a downturn. Featuring business guides and insights, an ‘8 ways to get recession ready’ blog, plus a Recession Ready quiz, the free resources can be found at www.thealternativeboard.co.uk/recession-ready-resource-hub.