"Even in wartime people can make something good out of it", with these words Milan Pilja, member of the Exporters' Club for 10 years started his testimonial on how the (GFC) impacted Zipbolt , the company he created from scratch and similarly to numerous other SMEs in South Australia had experienced really tough times during the whole GFC period.

According to Milan, when the media started to talk about the GFC "no one knew exactly what it was, what we supposed to do and for how long it would last". Immediately the orders started to decrease, customers ordered less and negotiation with new customers started to "shy away". The building industry which is the core of Zipbolt customer base was seriously affected and the recession hit hard most of Zipbolt's international markets such as New Zealand and the United States.

So, what to do? Zipbolt needed a strategy in place to change the scenario and capitalise on the opportunities that the GFC might offer.

The first action was to renegotiate the manufacturing costs. Although Zipbolt is an Australian company all products are manufactured by third parties in Taiwan which also were struggling with the decrease of their international orders. Considering that over the previous years the price of steel and other raw materials had been increased on a continuous basis the whole GFC advent was the right opportunity to approach the suppliers and renegotiate the prices down, to more realistic and appropriated levels. The suppliers were receptive as they certainly did not want to lose more business.

Once the prices had been renegotiated, new sales strategies needed to be put in place to try to recover sales. Through the consulting services of a professional marketer Zipbolt put the following actions in practice:

  1. Developed multiple websites with a website link to Zipbolt main website, associating their product names with the most popular name tags within its industry, so when someone would research for products in Google the Zipbolt name would appear on the top of the search. In parallel, Zipbolt allocated a budget to advertise on Google Ads. Although it is hard to precise, Milan stated that he could notice an increase in sales due to this specific initiative.
  2. Milan personally engaged in contacting all his customers. He asked about how are they doing, how are they handling the GFC, let them know about the use of the new Google tools and if there was any market reaction due to that.
  3. Milan also personally regularly communicated with sales representatives in order to give them confidence to push the Zipbolt products. The reps received training and delivered to their customers kits of product samples kits with DVDs featuring animated movie presentations which resulted in being a very powerful sales tool.
  4. Zipbolt released a new range of products and redeveloped and improved some of the old products in the middle of the GFC with a very positive result. It sort of gave an impression that the company was very confident and knew what they were doing. The company remained innovative and kept the image of an improver of its products which generated a very positive image.

As a consequence of these 4 actions Zipbolt experienced a small but significant increase in sales at a time in which the absolute majority of companies experienced losses.

The case take-a-ways are:

  • "Always negotiate with your suppliers". If he had kept quiet the supplier from Taiwan might had approached him to increase prices as he had lost a lot of businesses because of the GFC. Milan attitude in crossing the line and asking for his help to remain doing business put things in a completely different perspective. Sometimes the better defence is to attack.
  • "Keep listening to the market, bettering your products and creating rapport with reps and customers". Give them a point of difference to sustain sales and market your product, improve quality and check carefully prices and payment terms.
  • "Trading in a world in crisis can be beneficial if you learn from the experience". The world is a dynamic place and next time a similar scenario occurs you will know what to do. A final tip: "always keep something on reserve for the rainy days".