When the going gets tough, business owners should step up their sales and marketing activity rather than cut back, says Richard Denny. 

Business speaker and author Richard Denny has authored and presented numerous training films and audio productions, and sold more than two million copies of his international bestsellers on selling, motivation and communication.

In his latest book Winning new business Denny shows how to make a sale without being aggressive or pushy, and looks at every vital aspect of winning – and keeping – customers and clients.

SME Web asked Denny about the Government’s recent campaign to urge small businesses to develop more ambition to become larger, rather than simply successful.

The thinking behind the campaign seems to be that small and medium size businesses (SMEs) either lack motivation or are being held back in their development, and that bigger is better when it comes to business.

Since Denny has helped thousands of SMEs to bring in more business and increase turnover, does he think the Government is right to persuade SME owner managers to develop a drive to grow their business?

“Why should the Government dictate to anyone what to do?” he asks.

“I believe that it is up to the individual company. Some firms are better off small, others may well develop into larger organisations but I wish the Government would stop interfering and let businesses get on with it,” Denny adds.

Recession does not mean that everything stops

Does he accept that the UK faces a recession?

“No, I don’t. I think any evidence is used as an excuse to justify scaremongering about a recession at the moment. Speaking to firms around the country, I find that most senior managers are still pretty optimistic about the year ahead,” Denny says.

He warns, however, that owner managers will find conditions undeniably tougher and may have to work hard to build a good case.

“Recession means zero per cent economic growth, not that everything suddenly stops. There is so much nonsense put out about this,” he points out.

He explains that there are four ways to grow business: gaining new customers, increasing the average value of transactions, increasing the number of transactions done by existing customers and through acquisition.

“You can always find money for acquisitions, even with the current market conditions,” according to Denny.

He explains that venture capitalists, banks and business angels may be more prudent with their money, but believes that a well-presented, sensible proposal for an acquisition still has every chance of being supported.

Cut back on advertising and promotion 

The real danger lies, according to Denny, in what he describes as “the classic SME scenario”.

“At times like this, people running small and medium size businesses cut back on everything, when they should be stepping things up a gear,” he explains.

Instead, they often become less productive, cut back on advertising and promotion expenditure and delay essential innovations.

They are also prone to compete more on price, a move Denny vehemently rejects.

“Around 25 per cent of buying is done on the basis of price. The Internet makes it increasingly easy for customers to shop around for the cheapest deal. The rest, however, is based on value for money,” he points out.