Turn the Slowdown into an Opportunity: 5 Ways To Move Ahead of the Competition
March 2009
When times are tough, smart businesses seize opportunities for improvement whenever and wherever they can. While cost cutting may be necessary in the near term, it’s important to look beyond today to the time when demand will begin to recover – as it most certainly will – and prepare to be even more competitive when that happens.
When inventory and production rates are lower, it’s a great time to:
1. Take a hard look at all inventory and use up / sell off / re-purpose and otherwise deal with those stocks that may not have gotten your attention when you were busier. Look for ‘hidden’ inventory in work areas, back rooms and other places where it shouldn’t be. Count it, move it to authorized stores areas, and decide what to do with it.
2. Enlist production workers in a campaign to simplify work processes, clean up work areas, and make incremental improvements in a Japanese-style kaisan campaign. There are more resources available now to really focus on these tasks.
3. Look for ways to increase sales. It may seem counter-intuitive, but this is a great time to launch new and improved products that will capture market share as the economy recovers. Think about variations that are easier or more efficient to build, or improvements that reduce costs while improving product appeal, durability or functionality.
4. Make a modest commitment to marketing and advertising that will buy much better visibility and establish confidence with customers. Companies tend to cut marketing first when business slows. If you’re one of the few out there, your ads will be more noticeable.
5. Focus on the business that’s profitable while identifying and eliminating unprofitable business. This requires that you know your true costs by product / customer / market.
It is not enough to simply survive the lean times. Competition will be keen when the economy turns around and it will be a rare opportunity for those companies who are prepared to take market share away from those that are less prepared. There’s a lot more behind the advice offered here and we can help you achieve some success even when times are tough. Contact Dave Turbide to find out how we can help you pass your competition during a recession!
Dave Turbide, CFPIM, CMfgE, CIRM is an independent consultant and freelance writer. Find out more at www.daveturbide.com