Expert: Trimming is essential step

With the country now officially in a recession, the Houma-Terrebonne Chamber of Commerce is helping small businesses to handle it.

Business consultant Mohanad Mohammed spoke at a Chamber breakfast last week giving out tips on ways that companies can trim their operations.

Black Friday sales were up, Mohammed said, but the following weekend and Cyber Monday were down.

To deal with the recession, first off, business owners have to look at their employees. Workers can become disheartened, he said, but management should try to retain them. Employees know the customers better than management, and if they are let go, new ones would have to become reacquainted with the customers.

But business owners need to break down the cost of each employee. For instance, how much electricity does he or she use? Employees cost more than their hourly wage, he said.

Business owners should retrain workers. “The old way may not be the best way,” Mohammed said. They should also try to use employees who can work at home.

Mohammed said owners should use the services of Certified Public Accountants and QuickBooks, and argue with suppliers to obtain better prices. Consignment should be used. Getting free samples doesn’t hurt either.

Web sites for business are important, he said, but they do not have to be fancy.

The sites need only tell the name of the business, what the business offers and where it is located.

Being in a recession, owners need to question why customers are utilizing their business and know who they are competing against.

“What differentiates me from others?” Mohammed said businesses have to ask.

Owners need to understand that people are buying necessities. Don’t turn away business. Anything that allows customers to get to know your company is good: carry business cards, thank customers, offer multiple services.

Businesses involved with entertainment fare better in recessions than at other times, according to Mohammed.

“People want to get away from their problems to feel good about themselves,” he said.

Advertising can be tricky, he said. Owners have to advertise seven times for one to catch hold, and the effectiveness of small business advertising on television is questionable.

Mohammed offered some small money-saving suggestions for businesses, such as eliminating water coolers in favor of using filters on the tap; turning off lights, and using lower-cost, non-brand items.

“Bleach is bleach,” he said.

Mohammed had advice, too, for businesses that fail during this recession.

“When a seller files for bankruptcy,” he said, “if the person offers you the next three years in next profit, then sell.”