Best Business Practices for 2022

by | Apr 8, 2022 | Business Strategy | 0 comments

Can small businesses battle through the current level of inflation that we are experiencing? Can they stay afloat in this challenging economy? According to a recent survey, over 40% of small businesses said that their main concern was inflation, which is becoming increasingly problematic. Small business owners are being forced to raise prices in response, but this doesn’t sit well with customers who are also grappling with the effects of inflation. The same survey showed that over 60% of small business owners said supply chain issues were significant worries. While 25% said, they were negatively impacted by problems related to labor shortages.

How Inflation is Hurting Small US Businesses

Inflation is the rate of price increase over a set period. The dollar’s value goes down as the cost of goods and services goes up, thus making it quite difficult for consumers. In terms of small businesses, inflation can be very challenging. For one, the cost of supplies and materials rises. This makes it more expensive to run the business. Also, consider that inflation generally means companies have to raise their prices. Customers feeling the pinch may no longer be able to afford those goods and services, and therefore, the small business stands to lose sales. What’s more, companies are seeing narrower profit margins. Maintaining their average profit margins during a period of inflation is nearly impossible in some instances, which has a detrimental impact across the board.

So the question is, what is there to do? How can you adapt to the current environment, ballooning inflation, and consequently survive as a small business owner? Below are some tips and best business practices that you can start to implement to help you thrive in 2022.

What Are Some Best Business Practices Moving Forward?

1. Pay attention to your more powerful products. What differentiates you from your competition? Answer this question and pay attention specifically to what products are among your strongest performers. Then, rely more heavily on that product or those products. This is definitely among recommended best business practices.

2. Invest more in your customer experience. It is all about the customer experience. People buying products or services now is vastly different from how they did so even ten years ago. It needs to be an experience, a seamless journey. To weather inflation, you need to sell and find a way to boost that bottom line.

3. Consider subscriptions. Especially during the pandemic, subscription services did take off. More and more companies looked to a subscription model to help boost slow sales. This could be one best business practice that enables you to sustain yourself during a difficult financial period. Is this something that could benefit your business?

4. Diversify supply chains if possible. Supply chain issues are a reality that many small businesses have to contend with. If you rely upon one resource, this could hurt you in the long run. Reevaluate supply chains, even if it might cost you a little more in the short term.

5. Match competitor pricing. If your competitors have had to raise their prices, then it could be time for you to do so as well. Paying attention to what the competition is doing not solely in terms of pricing but also in terms of their marketing strategy, for example, can give you greater insight into your situation.

First Union Lending is Here to Help

Our job is to see you thrive and ultimately succeed. This is why we do what we do. We work with small businesses across the country. We offer short-term loans, lines of credit, and SBA loans, among other financing types. Even if your credit score is less than ideal, we might still have a funding solution for you. Call today and let’s get started together.