Last years goal was to grow the yearly profit by 10%. We were on track to attain this goal up until the month of October. Then the global economic crises arrived and our last quarter results went down by 50%. This loss had a huge effect on our 2008 results and we attained less than a 2% growth. Far from our 10% growth goal.
In March 2008, we made a collective decision to not replace the employees who quit the company. At the end of 2007, we where nine employees. Two people left between November and December 2007, and the last person left in February 2008. My employees picked-up the slack and did a fantastic job handling the growing workload.
Because the employees were dedicated to their tasks, I was able to raise everyones salaries and we finished 2008 with cash, which allowed me to give end of the year bonuses. But because the last two months of 2008 were not profitable, especially december, I decided to not take my bonus but instead kept the funds within the company’s cash flow. I believe that a company has to be responsible in regards to its employees when faced by tough economic climates. We see to often bosses taking huge bonuses for years, instead of preparing for a storm, and then they layoff devoted hard working employees without caring about the consequences.
Why survival? Because. I believe that a company cannot grow without investing in hiring new employees and new technology. New energy in the work environment brings a different “savoir faire” and fresh ideas. New technology brings efficient ways to respond to our customers demands and it gives us tools to improve our turnaround time. Because of the current economic climate, during the first two quarters of 2009, there will be a freeze on infrastructure development and on hiring.
- A drop in orders requires reorganization within the company staff. Three employees are undergoing training to handle the work load in the division that has not diminished.
- Approaching new customers: Different strategies are being implemented after brainstorming to attract new customers.
- No capital expenditures and scrutinizing our daily spending to reduce our burn rate.
- Reduce the boss salary (mine).
- A freeze on company bonuses and raises until the 2009 results are known.
- Devoted more time to develop the company and be more efficient in our work.
Fortunately by not hiring in 2008 we took the right decisions. It seems that our company is ready for this fight. We will not need to layoff employees if everybody in the company plays a fare game and accept new rules and the length of the crises.
This means I will have to focus all of my time on building out this company for the foreseeable future and trying innovative ideas.
Right now our biggest challenge will be finding new clients in an unfavorable economic environment. We need to attract new customers and prove our worth so they will switch to us... but I guess this can be said about any business.
What are your business goals for 2009?