If you run a business right now, then inflation is probably high on your mind. After all, it’s soaring right now! In fact, according to the ONS, the consumer price index (CPI) rose by 9.4% in the last twelve months to June 2022, up from 9.1% in May 2022. This is a scary figure for any business owner, and with inflation predicted to soon reach double figures, the worry is only set to increase.
However, there are some things that you can do to try and limit the dangers and problems you may face.
- Watch your spending.
As much as it is always important to focus on the future and consider new investments, be more careful about what you commit to financially at the moment. You need to ensure you can keep your current services and products available and that you invest in keeping these competitive. Remember, inflation makes it harder to stay profitable, so it’s essential to keep your current client base happy and to remain in front of your competitors.
However, once you have secured this, it is also good to look for investments and initiatives that will make sense. If you do choose to invest, make sure that it is likely to bring in good returns and also that the investment itself won’t bite into your cash reserves too heavily.
- Be careful with your money.
Protect your cash reserve as much as possible. As inflation goes up, your money will do less for you, so it’s essential that you can maintain flexibility in spending. Also, try to avoid bad debt by limiting who you give credit to and by being less generous with your payment terms.
- Hire good people, but only when needed.
Hiring people during a time of high inflation can be risky. As a rule, only hire if your product or service is going to suffer from not having more staff. If you do feel it is a good time to grow your team, then take extra time to analyse each interviewee, ensuring they really are the right person for the job.
You may want to invest in employee incentives in order to attract the right people to your company, as during hard times it’s important to have the best people on your team. It is also important to ensure you have a well-equipped and professional working environment, in order to keep your team happy and less likely to wander from your company. You can provide this yourself, or you can rent a serviced office from BE Offices to make things easier.
- Be Flexible.
During inflationary periods, it is crucial that you remain flexible. When costs increase for a certain service or raw material, you may find that your business strategy changes with little warning. It is important you can learn to adapt to these changes without sacrificing your product’s quality or your customer’s happiness. Look for new opportunities or alternative solutions to your problems. Failure to do this may result in your business being left behind.
- Use technology to streamline tasks and increase productivity.
There are a lot of technological solutions out there and they can play a part in many different sectors. Research the technology out there that could help your company and see if it would be a good investment. If you have an area of your business that needs to be more efficient or that could be more productive, technology may be an answer.
OTS News on Social Media