Stagflation and exchange rate volatility impact business plans. While, small and medium-sized businesses need to tighten their belts. The keys to grow, despite the context.

 

By Facundo Sonatti

If Argentine businessmen are trained in something, it is in driving on winding roads. It deserves more attention and adjust the belt to avoid a drastic impact. Federico Baigun, co-founder of Reina Batata, a boutique bazaar chain, postponed the opening of new stores and reduced a 10% your staff this year. “Por la inflación, ajustamos lo más real posible tanto los precios como los costos para ser competitivos y seguir manejando el volumen que queremos”, ensures and adds that, to make it, it is key to monitor the numbers and face the deviations that are presented, adjust course quickly, to maintain the volume or gross profit of the business.

Para Sandra Felsenstein, director of the consulting firm for SMEs Dinka, in times of crisis, it is natural for the youngest to reduce their expenses and investments and implement savings measures. On the other side, many times, it happens that necessity leads companies to search for efficiency, which could be the positive aspect of these situations (see box).
“Al disminuir costos, it is essential to try to simplify the processes. Not only to reduce the company's expenses but also the superfluous ones that do not generate added value to the final product, increasing the cost, and with it, the price. Esto significa reducir al máximo los procesos burocráticos internos que emplean tiempo y recursos que no se traducen en ventajas o beneficios para el consumidor”, the specialist recommends.

“Auditamos todas las áreas para entender en qué podíamos mejorar para ser más rentables. Quedaron más relegados los gastos en publicidad y consultoría externa”, reviews Gisella Djenderedjian, CEO of Dvigi, the purification firm that he inherited from his father and increased a 60% your actual sales so far this year. At the beginning of this exercise, the company contracted consulting services in online advertising. “A mediados de año, we train a person from the team to carry out this task. We managed to internalize concepts, reduce consulting costs and improve results in a 40% (sales / investment in advertising)”, details.

Gabriel Fame, in front of the Cadore ice cream parlor, affirms that the situation forced him to reduce a 15% your staff in low season. Salaries represent the second component of costs for the company. “Firmamos un convenio con 35% of rise with the direct incidence on social charges, ART, obras sociales y aportes sindicales”, Fama points out and affirms that, despite the progressive decline in profitability, sales volumes remain.

Cadore became famous based on a craft product, in the epicenter of cinemas and theaters in Buenos Aires in the late 1950s. Today, remains in its traditional location on Corrientes Avenue and produces more than 30.000 kilos per season. “La calidad y artesanía, the dedication we put into making, distinguishes us and ensures that sales volumes do not decline. Sin olvidar la recomendación de nuestros helados por el boca a boca”, adds the businessman.

“Nuestra principal actividad, Temporary Staff, is an indicator of the moods of the economy. When tailwinds blow, we are the first to go up, and when you feel drops of drizzle, we are one of the first lines of cuts of our clients. Therefore, we have to have a big waist in difficult times and everything that is not a critical expense, regardless of area, es revisado minuciosamente”, José Ignacio de Artiagoitia launches, founder of Two Eventual Services, human resources consultant, founded more than 20 6 years, with 300 temporary employees and a turnover of $ 35 millions.

“En este rubro, it is key to keep financial indicators in order. By not handling raw materials or stock, we cannot defer payments to suppliers: the most important line of expenses, y por ende crítica es la de Sueldos”, explains the businessman. “Por ende, we started with a strong work in collection management and cash flow management. The payment chain of companies feels heavier, por lo que la caja liquida se volvió un factor crítico”, add.

“Una acción que detona este tipo de períodos es el estancamiento en la contratación de personal y, sometimes, the subsequent dismissal of collaborators. In many cases, the owners of SMEs evaluate this the same way I can do it, I can start taking more tasks from the company, and so on. You have to be very careful with this, and do not forget that the entrepreneur's time is worth a lot, has a very high opportunity cost, y que resulta fundamental que él no abandone su dedicación a la elaboración de estrategias de la compañía para dedicarse a tareas operativas”, adverted rock stone.

“La presión fiscal es muy importante y las líneas de financiamiento se cortan cada vez más. However, we hope to meet this year's budget and, in the best case, sumar clientes”, share from Two Eventual Services.

Common denominator

  • Contraction in investment in advertising and marketing. SMEs use tools that allow them to manage the relationship with customers without the need to invest too much
  • The two faces of inventory. In some cases it is decided to reduce the stock. Conversely, in other firms, the constant increase in its replacement costs generates increases in stock. This depends on the financial capacity of the firm..
  • Desperate to sell more. It is common to see entrepreneurs desperately trying to increase sales to offset falling profits.. The focus should be on optimizing the performance of SMEs.
  • Source: Dinka