Note: Running Fridays in FromGregsHead.com, is a continuing series of tips brought to you by Greg Price. These run Saturday mornings during the BusinessMaker’s Radio Show on KPRC 950AM. Audio files can be found on the Entrepreneur’s Playbook™ page of the PKF Texas website.
What began as seemingly isolated showers in business markets has evolved to an economic storm that some experts predict will bring on a lengthy recession. In response, businesses worldwide are tightening budgets, cutting costs, and changing direction to weather the storm.
But where should you cut, and where should you invest to safely pilot your company through these turbulent economic waters?
The crisis is creating new challenges for corporate officers and other business decision makers. The kneejerk reaction to cut spending across the board, however, can be counter-productive when it comes to reducing risks during economic slumps. Instead, strategic investments in specific areas can actually cut costs as they improve operational efficiencies, personal performance, and customer service.
In fact, according to a recent McGraw-Hill study, companies that continue strategic spending not only outperformed non-spenders during a recession, but also experienced revenue growth of 275% during the first full year of recovery.