As sales slip strategies need to be reviewed.

 Increase marketing spend and take a pay cut is the advice to small firm owners from fellow entrepreneurs as the latest research into the health of UK’s small and medium-sized enterprises is published by the Small Enterprise Research Team (SERTeam) at the Open University.
 
The survey of over 700 business owners reflects trading conditions in the second quarter of 2008 and shows annual sales performance down again and expectations at their lowest ever for this time of year.
 
However, tactics to stay afloat include increasing marketing expenditure to win new business, advocated by over 49% of the most entrepreneurial respondents and refocusing the business into new markets/business areas (42%).

Over half (53%) of small business owners say that if the current uncertainty became a more severe downturn then they would expect to cut their own personal drawings/salary.
 
Small businesses which have been forewarned have been forearmed and may be able to follow the example of Maidstone-based Secure Engineering Ltd, installers of CCTV.

Director of Finance Linda Doherty remarks: “Fast assessment of the economic downturn almost one year ago has meant that the owners of our business have been able to act quickly in limiting any potential damage. We undertook a complete staffing and costing review to maintain quality of service as well as profit margins.  The company is actually emerging stronger than before as a result”.
 
For many small firms, particularly in retail, construction, hotels and leisure, trading conditions remain a challenge but for some, especially in manufacturing and business services, sales appear to be rising. Over three-quarters (77%) are operating at less than full capacity and red tape as well as the economy continue to test all respondents’ resilience.
 
Professor Colin Gray, Chairman of SERTeam says: “In the midst of this turbulent churn, there are thousands of small firms that have stood the test of time, surviving various cycles of downturns and upturns. This it is not just a matter of luck. Our surveys reveal that resilient small business owners have adapted to managing the vagaries of business life and that they help carry the whole economy through the bad times, as they are now.”
 

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