Private equity-backed CXOs are facing increased pressure to reduce expenses amid rising inflation, supply chain constraints, and an overall 22% decline in private equity deal volume. According to our recent survey, 75.5% of CXOs are making more cost cuts than they were 12 months ago. 

While there are many reasons to make cost reductions, there are also several concerns executives have when approaching cutbacks. Damaging relationships with customers ranked as the top concern when making budget cuts, followed closely by lowering product/service quality, hurting employee morale, and eliminating institutional knowledge when cutting personnel.

To mitigate the risk of cost reductions, consider the following avenues of growth: 

Prioritize Customer Success

Prioritizing customer retention and satisfaction not only helps avoid losses, but is one of the most profitable areas of growth. According to HubSpot, increasing customer retention by just 5% can increase company revenue from 25 to 95%. Such top-line growth is critical to maximizing EBITDA and widening profit margins. 

“Double down on incentivizing your sales team and customers to purchase high-demand, high margin services work.”

— Anonymous PE-CXO survey respondent 

Read More: Customer Success — The Cog in the Wheel