It is a concerning yet common scenario: Fear and confusion regarding how to handle the current economic crisis is paralyzing many companies into a state of inaction, where they are barely scraping by while passively “waiting” for the tides to turn.  And hoping they are still standing to see the other side.

One of the main goals of IRE’s “Cost-Reduction Genius” Robert Ancill is to show businesses how proper planning (financial and organizational) and creative, smart solutions can help them not just survive the current recession.  The right plan, attitude, and actions can enable companies to profit during tough times…and stand stronger than ever when the market recovers.

While the following list is far from comprehensive, it gives owners and executives some initial ideas for reducing expenses and boosting the bottom line, turning a down market into dollars and cents.

As a result of the dollar’s decline against many foreign currencies, the increased price of international goods has cut sharply into the profits of many US-based companies.  One often-overlooked solution is to reevaluate domestic sources.  Because of the dollar’s shifting worth, shipping and distribution costs, and the need of US wholesalers to increase their client bases in this economy, you may find that sourcing goods from US vendors is now the more cost-effective option.  You’ll also be doing your part to stimulate the domestic economy, helping everyone see the end of this recession sooner.

There is an upside to the deflated value of the dollar: Your goods and/or services are less expensive in many world markets, making them a high-value alternative for foreign consumers.  In fact, the price of US goods and services is at an all-time low for buyers in Japan and Europe.  This means there may be significant, untapped international markets that could be sizable sources of revenue.  In other words, there is an excellent opportunity for growth, even during a downturn. 

It’s important to note that this strategy can mean boldly pushing into new territories for the possibility of huge reward.  However, it can also mean making more low-risk moves such as incorporating Internet sales.  If your product can be sold and shipped easily—or if you can diversify by introducing something that can—you can pull in global customers while minimizing initial output.  And whether you are a small chain of casual eateries or a national leader in luxury accommodations, this is growth and industry gain that can be maintained once the market recovers.

Some industries are hit hard by the current crisis.  But as we know, when any one area is pushed down, inevitably, another must pop up.  Even when the macro trend is stalled spending (actually, especially when the macro trend is stalled spending), people will increase spending in certain micro areas.

So while it isn’t always an option, if you think creatively, you may be able to identify related industries to target…in sectors that are stable or even experiencing a surge.  For example, supermarkets, energy, healthcare, and the government sector are traditionally less affected by larger trends.  Meanwhile, entertainment is an industry that actually reports increased profits during challenging economies—in fact, market-research giant NPD Group reports that video game sales (both games and consoles themselves) jumped 63% between 2007 and early 2008! 

A recessed economy can be an opportunity for stronger businesses to acquire their weaker competitors at extremely reasonable prices.  If a smaller competitor still has a significant client base, acquisition is a chance to increase market share and condense resources.  That being said, do consider two caveats: First, make sure to thoroughly explore why the competitor is in a position to be acquired in the first place; and secondly, while expanding or diversifying your brand may be a sound strategy, don’t divert too far outside of your niche.

We all know it’s cheaper to keep an existing customer than to convert a new one.  So if prospecting to grow your client base isn’t in your short-term budget, one idea is to create a market for selling upgrades or auxiliary products to current customers.  Not only can this bring in much-needed revenue, it will keep customers loyal, ensuring they’re still yours when times turn around.

When employees can be shown demonstrable losses in revenue, they may be willing to negotiate temporary salary or bonus decreases, particularly as an alternative to layoffs or store/branch closings.  However, in order to do so without risking morale, cuts must be made across the board, personnel must be assured that cuts are temporary, and pay decreases must be attached to firm reassessment dates or turnaround factors, so employees don’t see it as an excuse for management to reduce pay permanently.

One method for easing the unpleasantness of salary cuts is to offer something in return, like shortened hours or workweeks.  This way, while employees are being asked to accept lower wages, there is an upside as well in the form of more time with families, the ability to pursue outside projects, or less time/gas spent on five-day-a-week commutes.

Attacking office overhead is one of the most effective ways to make a serious dent in expenses and positively impact net revenue.  And one of the most effective ways to cut overhead is to (temporarily or permanently) downsize your corporate facility by taking team members virtual.  With advances such as Skype, VOIP (voiceover Internet protocol), hosted call-center solutions, and other virtual office technologies, collaborating with remote workers is easier and more inexpensive than ever. 

And saving in the form of rent, utilities, and equipment isn’t the only benefit.  Many employees view the lack of time spent commuting, gas and vehicle savings, and the comfort of working from home as incentives.  Some studies even show that telecommuters are happier and might spend more time working because of increased productivity and lack of travel time.  All this adds up to both overhead savings as well as possible savings in salaries because of the bargaining power for businesses.

Another positive of the remote workforce is its flexible nature.  Strategies can be crafted to meet the individual needs of your company.  For example, if onsite efforts are beneficial in certain situations, you can construct your own revolving workforce solution: Maybe certain departments come in on even days, while alternate departments utilize the space on odd ones.

As we know all too well, the price of fuel, steel, concrete, crops, and other raw materials can be unstable.  So if your business is impacted significantly by increased material costs, you either reduce your profit margin…or you pass on price increases to customers.  But how you identify an increase can make a huge difference in continued customer loyalty.

Passing along a price hike in the form of a surcharge is an excellent method of differentiating between costs you can and can’t control.  For example, when fuel prices spiked in 2007, companies that provided delivery and other transportive services had to offset the increase.  But simply raising their base prices would have risked hard-earned brand loyalty and possibly created negative feelings even among long-term customers.  Instead, many businesses found success by implementing surcharges, thereby demonstrating the direct link to the cost of the raw material.

Fuel prices are never going to completely stabilize, and everyone is becoming more concerned with conserving resources and easing our impact on the planet.  These are just two reasons why wise companies will scrutinize all aspects of how they transport products and services to their customers.  Whether it’s relocating a shipping center closer to major clients or identifying streamlined solutions for transportation, these efforts will not only cut costs in the short term, but will help your company compete in a post-recession market.

Besides being good for the environment, getting creative with conservation will save you big bucks immediately.  You might start by getting acquainted with your energy bill and making it a goal to realize savings.  Replacing traditional light bulbs with more energy-efficient compact fluorescent light bulbs (CFLs) or light emitting diode (LED) bulbs, installing motion-activated lighting in infrequently used offices, and purchasing power strips (which use less energy than plugging equipment directly into wall sockets) are easy solutions for cutting costs and protecting the planet.

After you’ve tackled your energy bill, move on to assess—then attack—areas of waste.  Once again, this smart sustainability solution will also generate substantial savings.  Some initial issues to examine are excessive printing/copying (which racks up paper and ink costs) and the purchasing of non-reusable water bottles.  But these are only the tip of the efficiency iceberg.  Get innovative, and there are many more to be uncovered.

As you can see by these 11 strategies, the key to cost mitigation is creative thinking; in fact, if you know where to look, expendable expenses are everywhere! 

Call 818 992 6765 ore email: info@thenextidea.net today and ask how Innovative Recession Economics can help your organization realize substantial savings…with our risk-free, 100%-self-funded program, where you pay only a percentage of first-year savings!