Guru Speak

Consequently, entrepreneurs need to engage in some serious business planning. From now on they need to find appropriate short and longterm strategies to cope with problems that may arise in order to keep their businesses afloat until an upbeat economy reappears.

SMEs have some advantages over big corporations. Since SME owners manage their own businesses, they are agile and can make quick decisions.

They are also closer to their clients and trading partners than corporations, so it is easier for them to keep abreast of what is going on with their contacts.

Entrepreneurs should make the most of these strengths in order to weather the economic crisis.

During a recession, effective cost management is another good strategy to help businesses maintain liquidity.

Start-ups expecting profits this year may be disappointed, as their expected income may not meet target, even though their business must go on and expenses are constant.

More specifically, production costs are rising, due to the inverse relationship between raw material prices and purchase volumes.

Entrepreneurs need to manage working capital and avoid excess raw material inventory.

Although they can buy raw materials at cheaper prices, they have to bear increased inventory costs, and it might not be worth the risk.

Staff operating costs are another factor affecting total costs. Many firms have sought a survival solution by cutting down on overtime and salaries in exchange for more days off for staff, allowing their businesses to continue without layoffs.

It is a winwin costsaving approach for both employers and employees.

Many entrepreneurs may find challenges in terms of marketing after growing complacent with existing markets over the years.

The economic crisis provides a golden opportunity for them to review their markets and find new ones that might not have been contemplated previously.

Sales portfolio diversification may be necessary to pull through the economic crisis.

For exporters, it might be a good time to diversify sales portfolios into the domestic market by offering exportquality products, something that should not be too hard to execute.

When the economy regains its footing, portfolios will expand rapidly.

Companies can also emphasise branding, as it will help customers recognise their products, facilitate sales and increase marketplace negotiating power.

Besides effective management strategies, good teamwork will help solve problems in a well-rounded and timely manner.

A good practice is to encourage positive attitudes among team members, such as perceiving problems as challenges rather than threats. Everyone should be determined to solve problems together.

Since one SME strength is their relationship with clients, they should let clients and trading partners know that they care about them.

Companies can support their clients through information sharing, and listen to their problems and suggestions in order to jointly arrive at timely solutions.

The whole system will run smoothly if every link in the business chain performs well.

If every business tackled problems through mutual "caring" for one another, it will build a stronger business community in Thailand and help immunise the country against economic hardship.

No matter how poor the economic situation, we can join forces to weather the storm while smiling.