What can companies do in a downturn to ensure survival?

The economy for the past year hasn’t been at its best, and it’s just been one piece of bad news after another from various parts of the world.

At present, the macroeconomic outlook for the year ahead remains subdued, and near term indicators do not suggest that Singapore’s economy is about to rebound. Recently, the Ministry of Trade and Industry (MTI) announced the growth forecast for 2012 to be at 1.0 to 3.0 per cent.

In my interactions with local and international furniture manufacturers, it is unanimous that 2012 will be challenging for the Singapore furniture industry. Even as we come to terms with the fact that it is an arduous road ahead, it is heartening to know that there are various efforts by SPRING Singapore and Singapore Furniture Industries Council (SFIC) to boost the industry’s productivity and capabilities.

Other than tapping on government grants and assistance schemes, what else are furniture companies doing to ensure business survival? Most business owners have been quick to adapt, coming up with innovative solutions to minimise cash flow issues.

While some companies opt to go the way of undercutting competitor’s prices in order to stay afloat, others choose a perhaps longer term approach, by building stronger marketing channels that will help to weather economic storms.

Similar to other industries, one of the most efficient marketing tools available to furniture companies is the trade show. Participating in a trade show may require a relatively higher budget compared to other marketing activities.

However, exhibiting in one that fits your company’s marketing strategies will prove its worth in the long run. The issue then that faces many companies is in identifying the right event for their investment.

Exhibitions with strong visitor programmes and a good track record are attractive qualities to look out for. Companies looking for export or partnership opportunities should scout out shows with a healthy size of attendees from around the world.

Attending such trade shows will allow you to meet a large number of unique visitors over a few days, just by being in one place. Deals may be inked on the spot, and such companies see immediate returns on their investment. But there are also many business owners who are happy just to gather solid leads that generate transactions for the rest of the year, spreading their returns over a longer term.

Activities that help boost visitor numbers to a trade show include conferences, related industry-wide competitions or other fringe events. Conferences typically draw the top management executives to the event, allowing manufacturers easier access to the right audiences.

On the other hand, industry-wide competitions and fringe events broaden the content offered to visitors. This increases the reach of exhibitions and level of audience engagement, generally raising attendance numbers and in turn, generating greater exposure for your company.

Oftentimes too, buyers prefer meeting up at trade shows with their suppliers. In response, some companies choose to launch their new collections at exhibitions.

The fact that the products have not been shown elsewhere makes it more appealing for the visitor, and draws attention to the booth. Also, since potential buyers are already well taken care of by the organisers, companies are relieved of the burden to play host — this allows them to concentrate fully on networking and negotiations.

Despite the challenging circumstances in the year ahead, it is certain that opportunities are still available in the market, though everyone is now going after an undeniably smaller pie. It is imperative that businesses evolve to be more creative in managing operations for survival, making smart investment choices to ensure growth.

Decisions on marketing spend depend largely on the company’s selling point and strategy. Trade shows as a marketing tool is a viable option that companies should give careful consideration to, especially if they want to remain top-of-mind in an increasingly competitive environment. 

Clement Ng, Business Development Director, International Furniture Fair Singapore Pte Ltd