THE much-reported downturn in the global economy has made the managing directors of many small UK companies a little uneasy about the future.

But there are positive moves which may be made to buck the trend, says Michael Warne, the Wales and West director of the Chartered Institute of Marketing.

Michael Warne (pictured) said: "There are only three ways to keep a business viable. You can increase prices, cut costs or sell more.

"If you are already efficient, cost cutting is not an option, and of the options it has the least effect. "If you are experiencing a downturn you probably can't sell more. "So you are left with the toughest option; to raise prices.

"There is nothing new about this and big companies have done it for years. If volumes are dropping and costs must be met, prices must rise.

"So how do you do it? The answer is to know how to squeeze more out of your most loyal customers.

"Stop wasting your time on low-margin, hard-to-please wheeler-dealers and focus on your 'bankers'.

"Analyse your customer base and think of ways to strengthen these relationships. Remember these customers know and trust you.

"They will be open to new ideas and product development. "And it has always been easier to develop existing customers than find and convert new ones.

"When considering advertising, look at your 'marketing' process. "How do you get business? Is it actually 'marketing' or just 'promotion'? "Promotion of a small business can sometimes be cut to save money, especially if you are advertising in small, irregular ways and not measuring the results.

"Sensible advertising in a small organisation is always ruthlessly measured. "For most small companies, however, 'marketing' means 'selling' and that is something you cannot afford to stop.

"This is probably where you should focus your management time. "Love your existing accounts to death and you might be surprised by what new opportunities emerge.

"Spend more time with them. After all, your competitors will be trying, too! "If your own personal bias is technical or production oriented, think about possible range extensions and product improvements.

"These are things you can actually charge more for. "If, on the other hand, you are essentially a sales company, then try to focus on your service and negotiating skills.

"Concentrating here will help to control cash flow, too. "A final word of caution on finance; don't forget that when money is tight volume increases can make things worse."

The Chartered Institute of Marketing. Contact Michael Warne, 5-7 Museum Place, Cardiff, CF1 3BD or e-mail: michaelwarne @cim.co.uk