Economic recession is a positive phenomenon for the trade of very few businesses. However, recession can bring opportunities for SMEs in many other ways.

Recession is certainly a time when business owners should focus more of their time on examining the detail of the finances of running their business.  In boom times, it is easy for bad habits to creep in to the average SME.

Recession provides a chance to put those things to right. In particular, during a downturn with the future of the business at stake, owners need to adopt a zero tolerance policy to poor cost management or an underperforming workforce. Micro-management on a line by line basis of costs in the business can put a business on a sounder footing for the future for when the economy begins to recover.

Another obvious opportunity in a tough climate are merger, acquisition and amalgamation possibilities, particularly for those businesses that have husbanded sufficient reserves throughout good times to exploit the greater value that is always available in a tough climate for those businesses seeking expansion.

Greater value can also be obtained in other ways; there tends to be a greater willingness for suppliers to provide discounts, landlords to renegotiate “boomtown” rents and workers to accept more realistic pay reviews. In certain specific industries, a tough climate can also present opportunities.

Self employed subcontractors in construction who for many years have been busy on the now largely dilapidated building sites of Ireland will find that there is a huge untapped market for home improvements out there for expanding families who have decided because of the credit crunch to extend and improve their homes rather than buy new ones.

The licensed trade is another industry which, with careful promotion and marketing, can take advantage of the increased leisure time of a population in recession.  Many people trade down from restaurants to pub grub in those circumstances and it is essential that pubs provide a good food service to take advantage of that.

A tough climate focuses the mind of the SME owner regarding the tough decisions that perhaps have been put off for far too long.  Those decisions should be made today.