The Wood and Fiber Supply Chain Experts
Time2Manage
From the March 2009 Forest2Mill newsletter.
From forest-related industries, this recession has taken much —
customers, livelihoods, legacies and ways of life. About the only thing it has given us is time. As
the sound of hammers and nail guns ceased and sawmills and chain saws stopped humming, many of us
have been presented with the time to think proactively about our businesses. One of the keys to
survival will be spending this time wisely.
Cutbacks are necessary given demand levels for forest products, and our instincts might tell
us to retrench even further. The wiser approach, however, is not to retrench but to reconnoiter and
reconsider.
Reconnoiter — The old adage, "knowledge is power," applies in difficult economic times as
well as good ones. It’s essential to know your customer better than the competition. Doing so will
help you retain current customers and attain new ones.
- Stay in front of your customers — During lean times, companies that stay in touch with their customers, either through marketing or direct contact, will be better positioned as the recession draws to a close. When the housing market and the general economy pick up, those who have continued to remind customers of their presence will have the advantage over those who do not.
- Be a resource for your customers — Your customers are facing new issues and challenges; respond by giving them new answers and solutions. Do research and share your insights into the market with your customers. Remember that happy customers are the ones most likely to recommend your work to others and generate additional customers for your products and services.
- Know your competition — How is your competition faring? Have they become invisible in the market due to cutbacks? If so, take the opportunity to highlight your products or services to their customers.
- Research industry trends — the industry is in a rapid state of change, due to concerns over climate change and the need for domestic, renewable sources of energy. Wood pellet manufacturers, utilities co-firing wood with coal or burning wood only, and independent power companies are sprouting up throughout the country. Will these additions present opportunities or threats for your business?
Reconsider — Another adage applies here: "know thyself." From the basis of this knowledge, you can form a strategic plan to survive and thrive once things turn around.
- Have you done everything you can to survive the recession? Make a list of all your costs — carefully consider each cost to make sure that you’re using the most efficient processes, that there are no alternatives that would help you balance cost and effectiveness more advantageously. Have you cut everything that doesn’t help you meet current customers’ orders and establish your presence as a strong and healthy company in the marketplace? Brainstorm new ideas for increasing revenue; alternative ways of using your assets may pay off.
- In the current economy, almost everyone’s business is down, though to a different degree. Knowing how you’re doing in comparison to your competitors can be an important piece of information. Are you performing better than the market, or worse? This information can help you manage your costs and maximize your revenue.
- Reflect on the positive things you have accomplished in your business. Is there a way you can leverage these successes in other areas?
- Will you need more capital, new equipment, or additional products and services to be ready for the recovery? Now is a good time to strategize and pursue new investors and new assets. Good deals abound during a recession.
- Have you done everything you can to make sure you are ready to take advantage of an uptick in the economy, including finding new markets and selling to new customers? Much of the work you can do to this end requires little to no investment — except your time. Doing research via the internet or by making phone calls to your contacts in the industry and asking your current customers for referrals can produce enduring results.