This is the first article of a new series on business growth.
In this series which I have titled “Business Growth 101” I will be talking about the several challenges as well as tips on how to grow your small business.
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The highs and lows of business
Business will be slow whether you like it or not, so get used to it! Sometimes, if the cause is within your control, you could do something about it. At other times, when things are outside your control, there may be nothing you can do.
Fortunately for you, this unusual article is about the things you can do when business is slow.
In everything in life, there will be highs and lows. Business likewise, is no exception. There will be high sales periods as well as low sales periods, both periods are necessary for maintaining balance in business.
Both are necessary forms of feedback and any serious minded entrepreneur should focus on making the most of both periods whether highs or lows rather than choosing one over the other. This is a fact of life and its better you get used to it and learn how to make the most of it.
As humans, it is only natural to think in dichotomies; positive and negative, good and bad, black and white, high and low, hot and cold, pain and pleasure and all others. The truth is this; we need both shades of dichotomies to maintain balance here on earth. Those things we refer to as unpleasant are actually the ones that make us better human beings.
After all, we are creatures of feelings, and the unpleasant ones tend to drive home the point faster than the pleasant ones. We learn better from our mistakes than from our victories. The same principle applies to the business world. You cannot have one side and reject the other; both are necessary and have their benefits.
Somehow, entrepreneurs don’t seem to have any problem dealing with high sales periods; after all, we don’t ever get tired of having more. But when it comes to the low sales periods, all hell seem to break lose.
This unusual article is about knowing what to do when business is dull or slow. It will help you make the most of the low sales periods every business usually encounters every once in a while. It is very important to know that some low sales periods are self inflicted and others are not.
I have decided to write this because one of the businesses I run has gone through this phase and I am a better entrepreneur as a result.
Strategic Actions To Take During Low Sales Periods
When things don’t seem to be working out well in terms of revenue for your business, it is an indicator that something, somewhere, somehow is wrong. So, the first step to take is to trace the source of the problem. Meaning, take the pain to find out what is responsible for the low sales you are currently experiencing in your business.
What I have seen most entrepreneurs do when they are experiencing low sales is to lash out frantically looking for a ‘quick fix’ solution to the problem of low sales. I refer to this kind of response as taking wrong actions.
In other cases, they simply respond by doing nothing believing that “this little affliction is but for a moment.” I refer to this kind of response as inaction.
Whether you responded wrongly or you didn’t respond at all, both are inappropriate responses to the problem of low sales. Folding your arms doing nothing won’t make the problem go away, and taking the wrong actions would only end up complicating matters. So what do you do?
Like every Physician, you diagnose before you prescribe. First find out the cause of the problem [diagnose] before implementing any solution [prescribe]. Spend time on the problem and let the problem give you a clue on what to do.
Or else, you might end up treating symptoms rather than the actual disease. Then before long, the problem is back again. Remember, your objective is to solve the problem by understanding the root cause.
As I have mentioned earlier; whether high or low sales period, both are reliable forms of feedback for any business. High or low sales are not accidental; they are outcomes of certain factors. These factors are of two categories;
They are set of activities, behaviours, policies, strategies, and all other changes that occur within the walls of a business. They constitute the internal working environment of every business and are usually the making of either the management or the employees.
Internal factors are classified either as strengths [positive organizational changes] or weaknesses [negative organizational changes]. These factors if they are the cause of a low or high sales period are in most cases controllable and can be adjusted to alter whatever sales period your business finds itself.
For instance, if the employees of a business are performing at their very best, making sure every customer’s expectation is being exceeded every time they come in contact with the business, this can tremendously boost the sales of the business as it generates positive word of mouth for the business that eventually increases sales.
In the other hand, if the management initiates a drastic policy or strategy that will affect the performance of the employees negatively, this will in turn affect the level of satisfaction customers will get from the business. On the long run, a negative word of mouth is created and sales will eventually drop as a result.
Implying that, whatever changes occuring internally within the walls of a business, can potentially increase or decrease sales depending on its overall impact on the employees and eventually customers. This is why I emphasized that high or low sales periods are very vital forms of feedback for every business.
Never underestimate either of these two sales periods; they are great learning periods for entrepreneurs and the businesses they run.
They are the set of activities, consumer behaviours, policies, strategies, and all other changes that occur outside the walls of a business. They constitute the external working environment of every business and are usually the making of the government, society, economy, nature, technology, culture, competition and so on.
External factors are classified either as opportunities [positive environmental changes] or threats [negative environmental changes]. These factors if they are the cause of a low or high sales period are in most cases uncontrollable and will be a lot harder to influence in your business’ favour.
For instance, imagine what happened to the typewriter businesses when the computer was invented? This is a classical case of technology as one of the external factors at play in determining the low sales period every one of those typewriter businesses experienced during that era.
In fact, the advent of computer didn’t just alter the sales of businesses, it completely annihilated those businesses.
Such is the power and effect of external factors on businesses; they are very uncontrollable in most cases. Most especially for the businesses that didn’t diagnose early to find out the cause of their low sales when computers started gaining prominence as a better alternative to typewriters.
In every high or low sales periods, at the very least, one of these two factors must definitely be at play. Your task as an entrepreneur is to dig deep to uncover the factor or factors responsible for whatever sales period your business is experiencing.
Over to you
Has you business ever undergone a low sales period?
How where you able to get through this period of low sales?
Do you think diagnosing is essential for uncovering the reasons behind the low sales period?
Share your thoughts in the comment box below, in the next article under this series, I will be sharing some of the key steps to take in diagnosing low sales period in your business. Make sure you don’t miss it!
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Tito, thank you for this unusual piece. I really appreciate your insistence on taking a measured approach not just making brash knee jerk emotional reactions. The one thing that I would also add is that “up and to the right” is not always “right”. It may be that there are seasonal issues or market forces that simply need to correct and that the best course of action is informed inaction. Growth in sales that you are not prepared to sustain can cause huge problems down the line not just logistically but with your own internal culture and values. I like to encourage people during these slow downs, to slow down as well. Take on different projects or mentoring others, encourage personal growth and reinforce the bonds with your employee. They may not look right on paper (Starbucks decision to have a universal shutdown and re-training of barristas) but can pay off huge dividends down the road.
This is a very well thought out comment Chris, thank you so very much for stopping by here and blessing this community with such insight.
The way you put it shows you have been through it and that is what really resonated with me, you will notice that this is just the first installment in the series and much later on I will be covering some of the other alternative actions you suggested.
I will like to say that many are on my list too, especially the slowing down part and committing to internal growth and development is one vital action in slow times as this.
Chris, it was nice having you here, please do come around again! 🙂
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This is a good one Tito, God bless you. What we did was to increase our promo, like giving a certain percent of discount to customers who come in before noon and more discount to repeat customers also any customer who refers others to us gets a discount on his or her next purchase. We also call our customers more often now and also share such unique ideas like what you are sharing here to our selling customers because some of them do not have access to such informations and the more sales they make the more they will purchase from us. We also bring in new products to spice the old ones, thereby giving our customers more options to pick from, with these and more of in-house training of our staff with prayers we are able to still say there is a lifting up. Once more thanks for this….. wonderful opportunity to share.
Thank you for sharing this with the community Arena. I am impressed with the initiatives you have employed in dealing with this issue of low sales in your business. Very creative indeed and to hear that the outcomes were encouraging goes a long way to show that choosing to do the unusual has loads and loads of results if only more entrepreneurs will begin to think in this unusual way.
Thanks for the contribution. This community definitely needs more like this. Authentic testimonies of unusual business practices at work. God bless you too.
Thank you for this well crafted “unusual article.” I can certainly raise my hand to enduring “slow” periods in my business – especially when I first started. I can say that when I took a step back to assess the “why,” it inevitable came down to marketing. When I first started my healthcare marketing firm, I was so caught up in doing client work that I would go fairly long periods of time without marketing my business, which would force me to go fish for new clients. Once I stopped underestimating the importance of consistently marketing the problem diminished significantly. Now, when I’m face with a slow down, I do what is commonly referred to as “mine the gold.” I reach out to previous clients and make offers to see if there is any area in which I can provide them with additional services. This almost always result in additional revenues.
Wise move Marlee, mining the gold. I so like the sound of that!
I guess that’s the power of building a clientele list right? Nothing can be truer than this, it pays to have a list of satisfied clients to sell more to during low sales periods. This is one of the tips I am still going to cover later on in the series. It is a very strategic one many entrepreneurs aren’t maximizing.
Thank you for sharing your own side of the story with us, it made the issue of low sales not only real but also one we can ultimately cure if only we sit down to diagnose and address the root cause and not the symptoms.
Here you ago again with another great representation of your high quality brand. Your one of the best man. Your ability to convey a message is brilliant man.
I’ve gone through low sales periods. When those times became reality, I spent time assessing what I could be doing differently. It was during these times when my creativity spiked…because I HAD to make it happen. While I may have been conservative when the business was booming – I was open minded as ever when sales were down. I was very fortunate to not experience much dips in business – but it did happen from time to time, which brought upon some stress – but always picked back up.
I think diagnosing is critical. And, I think it should be a practice that takes place outside of low sales periods….it should be a part of the culture. Companies that constantly do this are the most innovative and profitable (google).
Great Job Tito with another MAD Philips quality production!
Thank you for the kind words JK,
Being open minded helps in diagnosing the problem of low sales. It is quite common to be conservative when things are great, you will see no reason to attempt the unusual because why bother rocking the boat when things seem great? It is in such periods that the cliche; “if it ain’t broke don’t fix it” becomes a mantra for many. But as experience has taught over and over again, when it is not broken is the best time to start looking for ways to break it. In business, this is called creative destruction. A lot of companies do this a lot.
A great example is Microsoft, every two years, they come up with a new version of their previous soft wares. They are the ones breaking new grounds in order to increase sales. They don’t take the conservative approach but go all out to shake up things long before even when they needed to be shaken up. As a result, they remain at the top of their game and rarely find themselves in low sales periods except when the source is from the external forces.
Thanks for your brilliant additions to the conversations in the community, I am so grateful. 🙂
Great work Tito, you have an uncanny habit for delivering the goods 😉
Like Jk, I spend time assessing my situation in life. What can I do to improve things? How can I live more? I try and up my game as much as possible, but in a way that’s natural to me, rather than forcing myself into something that my heart doesn’t want.
Keep up the shining examples Tito, your quality shines through in whatever you write 🙂
Thanks for coming around Stuart, I appreciate the kind words.
Diagnosing our situation before taking any action is a crucial step to achieving business or personal success. Not all actions bring about SIGNIFICANT [unique and useful] results. The kind of actions that do, are the ones we take only after we have carefully examined the root cause of the problem we are trying to solve.
Picking your own game and the field in which you play is also a great idea. Rarely do we excel by playing the game in which we don’t find true fulfillment.
Diagnosis is necessary when any one want to find out weaknesses in his business. And after diagnosis and analysis, he may be able to remove the bad factors from his business.
The good ol’ SWOT Analysis! Gotta love that! As you know my business is fairly new and haven’t experienced a High or Low sales period just yet. I’d say I’m somewhere in the middle for a beginning small business.
I’m with you when you say a negative/bad response is just as bad as no response.
For every action there is a reaction/consequence/result. It’s important we do monthly or quarterly reports to find out what is working and not working for our businesses. QUALITY CONTROL/MANAGEMENT.
By doing these frequent “check-ups” we can catch the weaknesses and threats in the early stages and possibly turn them in to strengths and opportunities.
Thanks for this. I’m going to be sure to keep up with these factors in my own business.
the idea of a monthly quality management is awesome, because as you rightly said helps to dictate the problems early and then makes getting rid of them less expensive. Overlooking this monthly check ups is what eventually leads to bigger problems like that of low sales.
This is perhaps why as small business owners we need to hire the services of others to help us keep all of these check ups in place as we may be too focused on creating and marketing that we forget to control our operations efficiently.
Nice addition Chelsea, thanks.
All of your business growth ideas are all great and awesome. When it comes to business expect highs and lows of income because not all the time is friendly to you, it matters on how you overcome certain difficulties that you have experience. Well, you made a great article with lots of lessons to learn. Thanks!
Thank you Daniel for this feedback. Business indeed is full of ups and downs and as entrepreneurs we must learn to make the most out of both times. It is not sufficient to choose one and ignore the other, there must be a way to draw out some insight from either conditions we face in our businesses.
Glad you were able to learn a thing or two from the article.
I absolutely agree most of the comments above, it is true that being an entrepreneur is not that too easy as everybody thinks because as a matter of fact there is no such things in this world that are made to be easy. When you have business expect high and lows of income because there are a lot of businesses exists.
Thanks Christy for leaving such a brilliant comment. Ups and downs are a necessary duo for entrepreneurs. One is not better without the other, they help to create balance and a healthy growth for both the business and the entrepreneur.
Thank you for being a part of the naijapreneur! community, we hope to see you around again? 🙂
Really, really interesting ideas and insight here. Different elements effect business’s differently and a lot of factors need to be considered. As far as generating more business I found a statistic that state writing instruments acquire an notable 692 impressions per month.
If you would like further information I would check out this website http://www.unitwin.com/websitepublisher/blogs/when-you-need-corporate-promo-items-consider-what-will-be-seen-the-most.html It discusses the benefits and how to utilize merchandise advertising.
The hardest part is diognosing what’s actually causing the slow down. Poor marketing? People just not interested? High Prices? Not reaching the right people? Industry changing?
That’s the hard part.
hi Mr. Philip Jnr. i find this very helpful, and am trying to put some mechanizing to place, i also try to take key points, like the internal and external factors that i read, as the matter of fact, a business man must always expect some low or high sale period, during those i think you will know what to do to avoid the negative one
For myself selling high tech equipment, I have seen sales dropped dramatically and there are few reasons associated with it and I will state on a generic level:
1) Price — Are we keeping up with the market conditions versus our competitors? Cost management with our vendors and manufacturing. Value differentiation with return on investment for both the company and customers.
2) Lead time and availability on products to meet customer’s deadlines with flexibility. The trouble with some high tech products coming oversees are built to order which can create enormous challenges for future sale which can lead customers to look elsewhere
3) Lack of cultural understanding and diversity within an organization involving business dealings — Customers in certain parts of geographic areas will have mixed negative feelings if we fail to meet their cultural requirements.
4) Product Quality and support capability
5) Innovation with vision — Especially in the high tech hardware industry
6) Are we easy to do business with? This can be net term credit lines depending on the customer’s trustworthiness and risks, Is our RMA and purchasing policy too strict? Do we have leverage to work with customers that either asks us to do push ins or pull outs on open orders?
7) Are we accessible and easy to get in touch with when our products and services are needed?
8) Are we maintaining contacts with customers or just being order takers?
In any event, these are basic generic causes that may bring sales down.
I started my cheesecake business about six months ago. I jumped off rather quickly and sales were booming. As of Dec, sales went way down. Orders are little to nil. What should I do?