Credit Matters

Surviving the Recession

Episode 11. 10th Key Factor – Legally Putting Your Competitors Out of Business

Kim Radok02 July 2020

There is no honour, or social kudos in putting your competitor out of business illegally. There may even be negative financial and legal implications if you have acted illegally.

Does that mean there are no other means to put your competitor out of business? Of course not. For instance, it is not your fault if your competitors operated improperly over the years and as a result, they go out of business.

It is also perfectly legal and practical, particularly as the recession proceeds, to want to see your competitors go out of business. After all, the number of your respective customers will likely decrease and the fewer competitors you have, the greater chance you have of making a sale. Now, I am not suggesting you deliberately target your competitors. Your primary focus must always be on survival and growth. Focusing on deliberately eliminating one or more competitors means you are not focused on your major objective of staying viable.

To make life more difficult for your competitors legally, starts with giving your customers every opportunity to stay and few opportunities to leave. To achieve this objective, you will need to operate a customer friendly and mistake free business. The means to achieve this situation includes:

  1. never underestimating the power of CASH;
  2. operating with one eye on profits and the other on social accountability;
  3. learning the “Art of Business” which includes understanding that NO is not the end of the sales conversation, it is part of the process and making some profit is better than no profit;
  4. maintain good business disciplines to reduce mistakes, maintain due diligence and hold people accountable for their decision making;
  5. create a great business team, because the real enemy is disharmony within the business;
  6. educating all your employees to be the best they can be;
  7. employ salespeople that are salespeople not just order takers and employ credit and accounts people to promote your business at every opportunity;
  8. employ people experienced in the real world of business;
  9. try to encourage slow payers to become better payers and get rid of unprofitable customers by sending them to your competitors; and
  10. if previously unprofitable customers return, give them a chance to become profitable again.

If you work on eliminating the weaknesses, maintain business disciplines and create a profitable sales ethos, then you have a chance of keeping every profitable customer. If this objective is achieved, you can perhaps stay in business by robbing your competitor as a by-product of operating profitably and sustainably.

CONCLUSION

The 10 key factors presented in our mini-blog series are designed to help you stay in business by operating and selling profitability throughout the recession. There are no guarantees in business at any time. During a recession, it will be even more difficult than the “old normal”. Much of the information in this series has been based on tried and true business practices over the years, many of which have been ignored in recent times.

The way forward to a “new normal” will therefore involve reinstating the best of the tried and true practices of the past, coupled with the best technology tools and practices of today. Get the process right and there is every chance, your business will survive the recession. Better still, you will more than likely come out at the other end with a stronger and better business.

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