South Africa’s economy suffered weak growth outcomes in the first half of 2017, owing to two sovereign credit rating downgrades, a domestic political crisis, and a second technical recession. More doom and gloom kicked offspring in the form of a fuel price hike. Then, out of nowhere, came news from Statistics South Africa that the country’s Gross Domestic Product (GDP) regained its strength with a 2.5% increase.
Economic activity grew by more than previously predicted in the second quarter, according to the figures released by Stats SA. The GDP improved by 0.4% more than the forecasted 2.1%. The upward revision is mainly due to progress in the primary sector – which includes the agriculture, forestry and fishing industries.
The improved GDP is not a magnificent figure, but it’s strong enough to break the chains of the recession and lift consumers’ moods as we approach the holiday shopping season. Now that the nation is revelling in the unexpected run of economic recovery, your business has the opportunity to capitalise on the promising signs of progress, such as lower interest rates on Personal Loans and increased consumer spending. Here are a few ways, which we’ve written in collaboration with Hippo.co.za, to revive your organisation in the wake of the recession.
Settle your debt
If you have accumulated any debt during the recession, now is a good time to dig your company out of its financial obligations. Start making larger payments toward any money you have borrowed, starting with those bearing the highest interest rates. If possible, you can also consider increasing your company’s operating profit margin, improving inventory levels, and restructuring your debts.
Keep an ear to the ground
Identify the most important market trends that can affect your business in the future. If you keep up with market trends, it will be easier for you to prepare for any changes that may occur in the future. Some things to keep an eye out for: what consumers are buying, the latest pricing conventions, technological advances, What Further Credit Rating Downgrades Could Actually Mean For You (in terms of interest rates, inflation and foreign currency exchange rate), and socio-political developments.
Recruit additional staff
During a recession, the demand for employment is higher than the supply. Talented people who have been laid off are likely to accept any job that suits their skill set, even if the pay is lower. You can attract quality skills – the kind of people that can help your business to grow – which you may not have been able to afford previously. Small business recruitment software can help you acquire the most suitable candidates for future hiring.
Get a few big clients on board – at a discount
One or two big contracts can really make a difference to your cash flow. Approach big-name clients and convince them to sign up to your business at a discount to sweeten the deal. Once you’ve landed these big contracts, you can begin to look for smaller, profitable projects that can sustain your business in the long run.
During an economic downturn, marketing campaigns have a propensity for reminding consumers that they’re stuck in a recession. These messages usually focus on saving and lowering prices of goods. Now that we’re at the lower end of economic growth you should strive to keep your marketing messages clear of financial concerns. Instead, determine how the recession has changed consumers’ priorities and let your marketing campaign position your business as one that will grow with their shifting needs.
Identify growth opportunities
Consider ways you can elevate your company. Including them in your business plan will drive you towards your business goals and develop new avenues to achieve success. There are several ways to switch things up to help to drive growth: invest in a new skill, attend industry workshops, network, and research your competition.
The technical recession has come and gone but the ripples and effects will still be felt for months to come. Experts say that there is still a long road to recovery ahead, but you can ensure your business gets back on its feet as soon as possible, and take major strides on the road to future growth.