I have had calls streaming in from friends in the market about being made redundant. It happened to me, and thankfully I landed on my feet, as all of my friends will too. However, it is really concerning as to how market forecasts petrify people into downsizing, stopping projects and generally tightening the purse strings.
What you generally find in situations like the current economic downturn is that it's the companies that fight the crowd, (grow when everyone else is consolidating and spend money rather than saving) that end up being the stronger in the times of good too.
My father is a builder and he has had multiple projects put on hold as a result of the scare campaign headed by the US economy. He is hurting, my friends are hurting and subsequently I am hurting.
But didn't we all know this was going to happen???
I mean, seriously, companies, banks and retailers cant expect to keep increasing profits every year forever. Logic sees that there just plain isn't an endless supply of money in the world. Even with Gen Y spending like there's no tomorrow the money will eventually run out.
So what were they all doing? Why did all of the car companies hire hundreds of people in times of good, just to sack them now? Why are IT companies sacking their workers? Why has Rio Tinto's share price dipped below $35 again?
The answer is that Market Analysts have told people to stop spending.
Yep - that's it.
Someone told everyone to tighten the purse strings and now they are doing it.
Isn't that insane? The Australian government is trying to fight this by injecting billions of dollars into the economy to keep the spending happening. I think it's about $20B now that they have spent (or intend to spend) and this is going to inject a heap of cash into the economy which should help keeps jobs secure and more small businesses afloat.
The thing that gets me here is that it's not really the small businesses who drive this. It's the massive public companies that are out to please their shareholders year upon year despite the fact that they bleed their customers dry, don't provide the service we are due and obviously put assets in building business and not strategic planning.
I find this baffling. For years I have wondered how long it will take for the purse to dry up - and it took about 15 years from our last recession of note here in Australia. Is this like the environment? I wonder...
I will explain this perhaps arrogant analogy for you.
Every couple of thousand years the world gets itself into dire straights: The Ice Age is an example of this. Global warming is a sign of another to come.
Thing is that the environment - the Earth - knows when things are on that line - the line that says "any more of this we are too far gone" and it corrects itself. This is not just a global phenomenon, it happens in smaller ecosystems too, whereby animals will actually change their behaviour to suit and correct to their environment to ensure the longevity of their species. Fish are an example where, in some species, they are all female and one becomes a male when the previous patriarchial figure gets a bit long in the tooth and can no longer reproduce.
Now the economy is doing the same thing, and I think that this is both good and bad.
Good, because it weeds out the crap.
Bad because people can work for crap companies and not even know it. And they are the ones that get retrenched and are going to have a horrible Christmas this year.
What is the "crap"? Companies that our out to fill their pockets: these are the ones that are going to be hit the hardest in this situation as they are the ones that do not have any customer loyalty in place. My suggestion to anyone as to how to approach this global economic crisis is this:
Keep your customers happy and provide good service.
It's as simple as that. I have been selling Customer Relationship Management tools into businesses for years now and it has become prevalent that this is not a priority for may businesses. The benefits associated with implementing systems like this far outweigh the costs. Unfortunately this is a hard sell to get past the CFO when the benefits are quiet intangible.
If you keep your customers happy, they come back to you rather than getting a quote from three companies every time they need something that you sell. If you are the good guys and provide real value to your client base, then you are going to be the ones with the steady stream of business coming in that you don't have to work for. Your BDM can concentrate on finding new customers to grow - not finding new customers to replace the old ones.
Spend some money on your customers!
So many businesses go about their customer relationships in the cheapest possible way. Often business owners are loathed to spend any money on their clients. But why? Aren't these the people that keep your business afloat? Don't these people spend money with you? The money that you spend could be on an Account Manager to help with these relationships, better systems to make your clients life a little easier, improves products to ensure that your customers are always on the "cutting edge" or simple incentives for repeat business.
All of these things will ensure longer term relationships with your clients and therefore money in the bank - LONG TERM!!!!
So in short - dont go chasing the immediate dollar. Operate with your clients the way that you would expect to be treated as a client yourself.
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