3 things small businesses can do to survive

in the current economy

If recent events in the Ghanaian economy teach us anything, it is this- for small businesses to survive in current times, managers have to rethink their business models. In better times, an average small business can survive by simply following a proven system. However when things get tough, it will take more to get by and only those who do something different will increase profitability. Michael Harry Yamson, Senior Partner at Ishmael Yamson & Associates shares his thoughts on three things small businesses can do to survive in the current economy.

1. Rethink your business model This is a good time to look at your market and ask yourself – ‘What practical things can we do to reshape the business, market, or segment? The answers to that question will vary. Let’s say a farmer harvests beans for sale. Costs of operations and seeds have gone up, workers need more money to survive, but you are unable to increase selling price because the market simply cannot afford it anymore. What do you do? In such a situation, it may be worth looking for other markets. With a cheap smartphone and about 10GHC of data credits, you can go online to find potential buyers in different countries. For example, India consumes a lot of beans and it may not be too difficult to establish contact with a handful of buyers there.

2. Open up the conversation It is rather surprising that while there is a lot of talk about ‘finding’ opportunity, there is almost no conversation about creating opportunity. Again, in a time of plenty, there may be opportunities lying around waiting to be found, but in these hard times, the more rewarding ones will have to be created by enterprising people. There are at least two advantages to be seen when we focus on creating opportunity. First, it makes you look deeply into your business and think about the things you can do for yourself in the current times. Second, if the conversation involves enough people and gains currency, it could become the paradigm shift in your market; and the basis for collaborations, joint ventures and mergers to grow the power of a new idea.

3. Focus on creating value Small business owners understand something that many professionals struggle with – the difference between the real economy and the ‘paper’ economy. According to a 2013 PWC report[1], 9 out of ten registered businesses in Ghana are SMEs. Small business is therefore at the heart of the real economy, where real value must be created for real growth to occur. It is when growth is occurring in small businesses able to build a stable demand which delivers real value, that Government can then play a more meaningful role using interest rates, currency stability and inflation, to manage the growth and the wider economy .

Finally Picture a cyclist on a bicycle. The cyclist must paddle first, before steering, balancing and braking can be useful. If Government action is to be useful, it must first encourage SMEs to paddle. No progress will come from simply managing (steering, balancing and braking) a stationary bike. SMEs are the future. Every help must be given to them to encourage new ideas on how to succeed, and support owners and managers of SMEs to act differently and take the lead in creating stable, consistent, sustained growth for the Ghanaian economy. Michael Harry Yamson is a senior partner at Ishmael Yamson & Associates, a management consulting firm that provides advice on strategy, brand and channel development, leadership development, and corporate and business turnaround strategies. He was interviewed by Newaccra.com. For more visit Newaccra.com

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