15 ways to survive the hard times says Tom Watson, professor of PR at Bournemouth University

If you want to thrive despite today’s grim economy, here are actions you should take right now:

1. Do business with clients who pay their bills on time. Cash flow is everything to do with survival.

2. Trust your instinct when negotiating with new clients. If you have worries about their business ethics or financial situations, don’t take them on.

3. Take time to negotiate commercial aspects of any appointment. Who signs off your invoices? When do they have to be submitted by? What is the payment date? Arrange payment direct to your bank account. Avoid the “the cheque is in the post” excuse.

4. Monitor your creditors and debtors ledgers assiduously. Make account managers responsible for commercial relations with clients.

5. Be prepared to do fixed-price projects. Retainer fees dry up in times like these as clients want to limit their costs. They are thinking short term, too.

6. Concentrate on fees. Let clients pay for print, vision, graphics and websites direct. If they go under and you’ve done the purchasing, it could break your business.

7. If you have to cut staff costs to keep afloat, do it. Entrepreneurs not only have to gear up for growth, but also manage in these difficult econimic times. Survival is, sadly, more important than sentiment.

8. If times are hard, bolt expenditure to the floor but make sure staff are paid on time. No more gesture spending. Negotiate or renegotiate all consumables and fixed costs like rent, photocopiers, advisory services and car leases.

9. Make sure VAT and tax are paid on time. HMRC gets very interested in slow payers and can go back six years into your accounts. In summary, it’s not worth the diversion battling the taxman.

10. Use freelancers when you need to grow the account team, until the business environment gives you confidence to recruit.

11. When things are tight clients want advice and action from experienced senior professionals. You may employ entrants into PR, but make sure experienced advisors lead accounts until the client has confidence in younger staff.

12. Ensure programmes have outcomes that can be evaluated. Objectives should be measurable, so get savvy on evaluation techniques. Clients want assurance that targets are being reached.

13. Build relationships with clients. You really get to know them, their ambitions and concerns. You’ll be a valued adviser.

14. It does get better in the end, so don’t borrow heavily to survive. The cost of repayments could cripple you on the upturn.

15. Do PR for yourself with the banks. They are running scared and want assurance. Give your good news and progress reports to your bank account handler; invite him/her to meet your people. Engage in their networks, too.

Is there an upside in a challenging economic environment? PR is busy and active. It can be very cost-efficient and targeted to deliver business results. Be brave and span boundaries – if clients want a fuller marcoms or corp comms service from your firm, give it!

Next steps: Develop your own action plan and ensure there is working capital. Get all staff involved in planning and marketing – they are as worried as you are.

Tom Watson, is professor of PR at Bournemouth University’s Media School. He also ran a PR consultancy for 18 years and was PRCA chairman from 2000 to 2002.