US Economy Forecasts

Janet Attard asked:


by Janet Attard

 

Has the economy got you down in the dumps? 

Is the sales prospect who seemed so excited about your product last month stalling this month? Did that big account you’ve been trying to nail in another company tell you they love your product, but want you to cut your price in half?  And, when you called the buyer you usually deal with at third company, did you get a recording saying, “The number you dialed is no longer in service.”  And, now, you’ve just heard that your biggest customer is going to start using an overseas company to do the work they had been outsourcing to you.

Running a business is never a sure bet, but in today’s economy it sure can feel like you’re caught between the proverbial rock and a hard place. What can you do when things get tough? How can you get ahead when your business is beginning to make you think of a bus emptying out on the last run of the day? Here are several strategies to consider:

Reinvent your business

You don’t have to be a venture-backed high-tech company to reassess your business model. In fact, the smaller and leaner your business already is, the faster you can shift gears and zoom back into action.

Sit back and take a cold, hard look at your strengths and weaknesses and possible markets. Advertisers may be staying away from your web site in droves, but could corporations use the databases you’ve developed or your technology? If you’ve been selling products online, could they sell offline, too? If you’re not selling online, why aren’t you?

Do you need to develop new products or services? Don’t guess at what customers want and will pay for. Analyze your existing sales and talk to living, breathing prospects. What do they need? What can you provide? What’s the best way to deliver solutions to them? What’s going to bring in the most profit?

Put it all down in black and white and look at the numbers. What are the easiest ways to make the most profit quickly? What should you be doing on a longer term basis to ensure your business continues to grow and prosper? Revise your business plan based on your answers, then start to work your plan.

Contact former customers

Don’t assume that a customer who stopped buying from you in the past will never buy from you again. Customers’ needs and circumstances change, just as yours do. The megacorporation that didn’t renew your contract a couple of years ago because of changing business priorities may have changed their direction once again and be a good prospect now. The customer who went with a lower-priced competitor may be dissatisfied with the quality or service and be receptive to a call from you today. Or, the manager who had given the work to his best friend may no longer be with the company.

Contact competitors of present or former customers

If a company needs what you sell, there’s a good chance their competitors do too. Industry groups you belong to, trade shows, seminars, and friends in the industry can all help you identify likely prospects. If the people you meet don’t need your services, ask if they can put you in touch with someone at their company who could.

Call former prospects

The bigger a business, the slower they are to move. The project that was put on indefinite hold last summer, may become urgent this spring. Or, some other project the company is working on may be right up your alley. So touch base periodically. The more recently you’ve contacted a client, the more likely they’ll be to remember your name - and your phone number - when they are ready to buy.

Sell additional products and services to existing customers

Often the easiest way to bring in new business is to sell more to your existing customers. You may be ale to sell more of the same product to the same contact, or sell the same product to a different division of the company. Or, you may be able to sell related products and services to the customer. Keep your eyes and ears open for new opportunities and be sure your customers are aware of all of your capabilities.

Work your Rolodex®

Labor statistics show people entering the workforce today are likely to change jobs seven to 10 times in their careers. You can position yourself for new sales just by keeping in touch with people as they change jobs. The human resources manager who hired you to do a harassment awareness training program for Company A, may need to find someone to put on the same kind of seminar at Company B. Thus, if a contact at a client company tells you they are leaving the company, ask them for new contact information.

Team up with other vendors for joint sales

Recommendations and referrals are among the leading sources of new business for small businesses. An easy way to get more referrals is to team up with other businesses who sell to the same market but don’t directly compete with you. Agree to refer business to one another and link to each others’ web sites. Look at possibilities for joint sales, as well. Doing so may allow you to bid on and win bigger projects than either of you could on your own.

Develop multiple revenue streams

That’s corporate speak for a concept that’s as old as the hills: find more ways to make money. For instance, if you are a web “content” writer whose market is drying up, hone your skills to write for offline publications, business brochures or technical manuals. Or, learn to do web design and desktop publishing and add those services to the writing services you offer customers. Other types of businesses might consider licensing intellectual property, selling advertising space in their catalog, renting direct mail lists, or performing services for other companies that they’ve developed for their own use.

© 2008 Attard Communications, Inc. Janet Attard is the founder and CEO of Business Know-How®, a popular small business website that has been providing information and resources to businesses for 20 years. The site publishes two free newsletters for small businesses. Subscribe to the Business Know-How® newsletters at http://www.businessknowhow.com/newsletter/subscribe.htm

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Murad Ali asked:


The American economy can go either way according to most newspapers and television commentaries. The experts say that we have a 50% chance of going into a recession while some say we have almost no chance. Trying to decipher their confusing messages can be difficult. That leaves most American businesses unsure of what the future holds for them. Are they still going to be able to compete or are they going to suffer a slow and painful decline downwards. The best way to answer that question and determine how to improve the business environment is to look at the American businesses strengths and weaknesses.

Success and failure is all about strengths and weaknesses. When we rationally see the strengths and compare them against the strengths or weaknesses of other countries we can better determine our chances of success. It is almost the same as when you bet on two boxers one of which has endurance and the other one quickness. The one you feel will win depends in part on how you see the situation. If you feel the quickness will take out the opponent in the first few rounds then he is the better bet but if you feel that the two boxers are going the distance then endurance counts.

Looking at the American business world and comparing it to the challengers you can also see better who is going to win in the end. We know that the world is a high-tech place where efficiency and cost matter. The one who produces the cheapest products is likely to win as long as their products have reasonable quality and don’t break down often. With Chinese cheap products and America’s high quality both countries will need to come closer to the middle.

Strengths of American Businesses:

High Technology: Powerful and growing businesses require email, Internet, cell phones, computers, robots and more. The technological advances of the U.S. are difficult to surpass and few countries even come close. American businesses can grow simply because they can manage different international locations as though they were a block away. Few foreign countries can do this. In addition, America also has the ability to develop and implement modern technology like robotic arms and complex systems that increase productivity.

Power Supply: China is attempting to get its hands on as much natural resources and energy as possible. The U.S. is also doing this but is much further in the game. While the U.S. is moving towards alternative energy supply and thinking beyond fossil fuels China is still trying to accumulate basic energy. American businesses have no problem with black outs, rolling power outages or a lack of energy. This is a benefit because their environment becomes predictable.

Strong Law Enforcement: It may seem silly and out of place but a strong law enforcement system helps to keep the business environment fair and equitable. When businesses can be cheated when making partnerships, employees embezzle and politicians bribed there is lots of risks built into the environment. Businesses want to know there is a deterrent and opportunity to regain what is lost through unfair practices. You will find that China as well as most nations outside of Europe or the U.S. has difficulty curbing crime.

Sound Fiscal Policy & Self Adjusting Markets: American policy makers have been generally concerned with how well the economy is doing. The democratic system allows the population to remove senators, presidents and congressmen out of office when they are not producing results. Therefore, a single politician can complete little damage in a single term. When small mistakes happen the markets can adjust themselves by offering something new that makes money. For example, if people demand companies to reduce pollution then these consumers will gravitate towards clean businesses while leaving the rest of the businesses behind.

Weaknesses of the American Business:

Poor Public Education: The American education system is declining and children are falling behind much of the world in terms of science, languages, math, and more. The advancement of these core subjects are important for the improvement of society as the new high-tech world will need scientists and technology workers like never before. However, as we keep allowing skilled workers to immigrate our school systems are falling behind only because there is little direction and lots of politics.

High Labor Costs: Workers are cheaper then they are in other countries. The problem in the U.S. is that companies aren’t getting what they are paying for. The average high school graduate is barely able to grasp the concepts of a manufacturing business let alone work within it while the government raises the minimum wage. A Chinese worker is able to press a button like the American worker but for about 1/10th the cost. Only productivity will make the American worker worth his/her wages.

Taxes: American businesses pay a lot of money in taxes while companies from other countries may pay a lot less. The taxes in American businesses are simply extra overhead that must be pulled from the cost of the product. In a tight economy where people don’t want to pay extra the cheaper products (with less tax burden) will win out. Have you ever wondered what happened to the television and radio producers in the U.S.?

International Policy: America has come to mean, “bully” to many people overseas. To thwart America’s power is a sign of resolve and fashion. As our politicians continue to play favorites with countries that violate international law, demand compliance with American desires and try and finagle other countries its reputation declines. A bad reputation means that both international businesses and whole countries may not only distrust us but prefer to do business with someone else.