The Texas Business Group

The Texas Business Group helps small businesses reach success.

Benefits Less

It is clear that we face again a process of slowdown in the economy and in this opportunity, it is possible to be a much more acute and prolonged situation than we have experienced in previous years, especially in Latin American countries, which we are more accustomed to this kind of situation that the Anglo-Saxons. All companies can be affected, but especially the companies listed as medium and small (SMEs) in our countries, can experience a more critical situation, especially because they have with minor resources that allow them to survive a prolonged crisis situation. They are the first who suffer restriction of credit lines and a decrease in demand for its products or services, generates a process of cash flow strangulation, which can lead to definitive closures. There are many traditional forms and other highly creative through which companies can address this situation. This is the season in which emerging afloat countless saviors and gurus that you say they have all the formulas to remedy the situation. Without wishing to minimize the problem, really the first thing you should do is analyze the problems with much common sense. We can expose the subject in a very basic way; the company is to generate profits and these occur when revenues less all costs and expenses has resulted in a positive figure. Therefore it is necessary to work on these two variables.

It is clear that if you live a time of economic downturn, achieving increased revenues, it is a very complex task, but it is possible with an adequate strategy. The easiest thing that found companies is taking action on the second variable, i.e. reduce costs and expenses. It happens that many companies take as their first and only measure dismiss personnel. It might sound logical. Fewer clients, less activity, then less personal and thus less costs. Other companies see this situation as an opportunity to improve.

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