How Can Companies Combat Recession?

By Author: Vijay Koragappa Shetty
Total Articles: 2542
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Reduce growth leads to lower profits, as a result there is a decline in dividends. Share market becomes less attractive as there is no money to invest and more over share market also won't do too well. Most of the firms faced a decline in profitability too.

Main reasons for this are:

When there is lower sales companies are forced to bring down the prices. They have to remain in the market and hence there is a price war.

Drop in sales will lead to reduced revenues.

Simple ways to recover your loss is to lower down operating and overhead costs as well as improving accounts payable and receivable. These are the potential business services. While it's entirely typical for lenders to get more cautious in a downturn, the near freezing of credit is something else again. Even companies able to pay higher interest rates may find that credit isn't available from the usual sources at any price. There is good news now, recently Government has taken an initiative to help all those industries which were hit hard during recession to regain their financial stability. Reports reveal that loans will be brought down ...
... to 2% until 2014. This will promote industries to invest more and stop saving. A good strategy to handle the wounded economy is devised by the Centre for Economics and Business Research.
Consistent client service experience and a competitive product offering is what clients would look for. They always are on a search for companies which will offer them a competitive edge or an awe factor in times of economic difficulty.

Keep investing to the core.
Do not reduce product rates
Re-strategize your priorities and face new reality
Offer new solutions to new problems that customers face
Think twice about acquisitions and mergers.
Always think twice about offshoring.
Focus on the capital from where you are getting and use it wisely

Do not stop funding in your most critical competencies such as product innovation, customer service or anything else. Investing is quite crucial to remain in competition post recession. How you use this money matters a lot. Therefore, use them wisely...invest only in areas where you see possible profits. Research shows that businesses will be in a better position when the economy brightens up, if they focus on high customer service standards during a touch economy. Boost your sales with healthy marketing mix and learn how much to invest in each sector.

Vijay Koragappa Shetty, Expert Author, Platinum Status. Information on Eco friendly corporate gifts: Eco Friendly GiftingUnusual business gifts enquiries at: Unique Business Gifts