Did you know that inflation is predicted to reach between eight and nine percent this year?
The exact number depends on which source you’re looking at, or which article you’re reading. But whatever new inflation record is broken this year, we know for sure that it’s going to be a big issue this year and in the next few years.
So as a business owner, you have to ask yourself: How do I beat inflation? How do I go up against something that is causing problems for much bigger businesses than mine? What steps can I take now to safeguard my business?
Have a Solid Foundation
Beating inflation starts with having a solid foundation. That includes having a vision, a mission, and a purpose.
Those three things will help you understand why your business exists and motivate you when times get tough. You need to define your “why,” your “how,” and your next steps.
In order to get a handle on your business’s mission statement, think about who’s coming through the door. Who are your top customers? Who are your favorite customers? What kind of people do you get to know, and what kind of people just come and go?
If you have an in-depth understanding of your customers, you’ll be better equipped to focus your resources on serving those top clients. Make sure you have unique offerings that appeal to those customers so they keep choosing you over other businesses. If you focus only on price, they’re going to go to someone who does a better job at catering to their tastes.
At its core, inflation is a pricing issue. The value of the dollar goes down, so in order to make a profit, businesses have to raise prices. And, of course, consumers have a negative reaction. In order to beat the pricing issue, you need to focus on those top customers and unique offerings.
What’s Your Why?
As a business owner, your “why” is the reason your business exists. It’s your mission statement. It’s what motivates you and guides the way you interact with your customers and manage your employees. Basically, it’s your business’s brand. And it needs to be about more than making money.
There are a lot of ways to make money. Why did you build your business the way you did, and not some other business? Why are you a business owner at all, why don’t you just have a regular job working for someone else?
Your “why” should be clear to everyone who interacts with your business, from your employees to your top customers to people who just come in to browse.
Bring It All Together
If you have that solid foundation, that “why,” and you connect it with a deep understanding of an appreciation for your customer base, then your business will be better equipped to handle the coming problems with inflation.
Remember that your core customer base isn’t the person who comes in and spends a few hundred dollars when you have a sale once a year. It’s the person who pays your regular prices for the unique offering you’ve developed for them. And if you have the proper operating procedures in place, with your cash flow managed and your employees all on the same page, you’ll be able to provide that unique offering and maintain relationships with those top customers.
When you have a solid foundation, an understanding of your top customers, and standard procedures in place, then the customer has an improved experience. And that improves your morale and your bottom line.