If there was a downturn in the economy, what 3 things in your business could be eliminated and your company would still run effectively?
I’ve started the process already.
- Walk-ins and phone calls have gone down dramatically. No need for a receptionist, laid her off last Friday.
- Stopped all non-essential purchases.
- May need to cut back hours.
- Consider eliminating someone else.
What is not essential to operations? Do a hard analysis of “must-have” and “nice-to-have”:
- Labor costs.
- Mentally get your head in the game, my role is to find positives to share with my clients and prospects. You can quickly go from having a “it’s not so bad” mindset to “gloom & doom”.
Cut back on my accounting and payroll services.
- Evaluate supplied products.
- Reduce the disposables.
- Hire one person full-time instead of six part-time people.
Payroll – reduce staff.
- I would eliminate some of the professional organizations I belong to.
- Eliminate the frills in the company – be on top of every dollar going out.
- I use a lot of plastic, I would try to negotiate better pricing with the vendor, maybe even look at other vendors.
You can always save a dime, no matter what.
- Cut the night shift, that would save an immense amount of money in electricity.
- Look at the people – night shift managers, different building managers.
- Cut some customer and employee relations as well as outside consulting. (donuts, contributions and outside consulting services.)
What kind of reality are we talking about?
- Hold on to your cash.
- Turn down the heat.
- Buy crappy toilet paper. “Hey, you’re fighting nickels and dimes here.”
- It’s all labor.
- We would close the door on Monday.
- We do a lot of meals for our employees – eliminate that.
- Eliminate outside travel (trade shows), bring webinars in-house.
- Reduce professional services and outside support contracts.
- Streamline how I do my buying – with perishable products, it’s a challenge.
- Cutting back – labor, non-perishable inventory.
- Review our “give back” – consider more carefully, especially when the organization is looking for cash.
My brain went into disaster mode:
- Office manager’s position could be spread among many (eliminate a position).
- Reduce intern hours.
- Staff meals, outings, community involvement and giving could be reduced.
In evaluating the last two years, we’re spending company funds somewhat carelessly.
- Eliminate temp positions first.
- Scale back on profit sharing.
Cutting back personally:
- My own salary and don’t purchase a new truck.
- Cut one of two people I have.
- Cut some R&D projects that don’t provide immediate growth.
- Reduce inventory – went down from 8 weeks to 30 days.
- I already run with the mentality of lean, so it is hard to decide three things to cut back. I would advertise only what the market will bear in peak season.
- Include everyone in the decisions on cutting expenses.
- Push the control down to the lowest level.
- Make it fun and make sure to give praise. It’s amazing what people will do when you let them.
A downturn is good for most companies. There’s a lot of fat and spending money without thinking about it. It helps get costs in control; we had 20% growth last year and made less money.
- We would look closely at the support roles in the shop.
- We’re a union shop, so cutting labor is hard.
- If work slows, we could shut down a heat treat line and save $20,000 in electricity each month.
A lot of questions about what is happening and for how long.
- Cutting salaries and/or hours.
- Sometimes we do better than others in a downturn because of our products.
- When we see a weakness, we try to get ahead when doing quotes, trying to ensure our costs are covered. Hit it hard quickly, it helps a lot.
- There are tons of places to cut costs and expenses. We would look at everything.
I would like to try to sustain through it, I wouldn’t reduce marketing or sales.
- Examine what we do to fuel growth, make sure money is spent on the right things – or eliminated if necessary.
- Eliminate one position / absorb the duties.
- Evaluate training and building for the future.
- Turn our focus to cost reduction.
This is the fifth recession our business has weathered!
- Cut non-essential employees.
- Cut back on producing so much product.
- Cut back on purchasing materials that go into products.
We provide onsite professional development seminars.
- Since all our classes have been postponed, it saves driving and making copies and sometimes hotel stays.
- I’ve been cleaning up paperwork.
- We are Looking into doing classes online via Zoom or another program.
I’m a consultant, I office out of my home.
- Cutting back on driving.
- Have more meetings via phone and/or internet.
- Consider learning a program where I could look at documents on a client’s computer from my office computer.
- There are a few subscription software programs that I’m hanging on to – I need to evaluate what I really need.
- I would drive less and ride the bus more.
- I would evaluate the need for office space. I could work from home if things got tight.
I struggled with this:
- I could cut evening staff.
- Get better at tracking exactly where my money is goes.
- Look at where I could combine purchases and save money.
- We might cut back on group activities with clients and employees.
- Pass duties to other employees.
- I’m a soloist and work out of my home.
- The biggest challenge is how a downturn would affect my clients.
- I’d work on marketing and sales conversations about how training would benefit their bottom line and increase morale.
- Have the clients print their own color copies OR I’d settle for coloring front and back.
- Cut back on the courses I pay for and take advantage of free resources.