To everything, there is a season, and those attending the Industrial Economic Outlook Conference learned that our economy is entering a season of recovery. Conducted by the National Fluid Power Association, this annual conference was held in suburban Chicago last month and brought together a knowledgeable (and often entertaining) group of economic experts.
I suppose some of the speakers returning from last year’s conference owe me an “I told you so.” That’s because they described how we were in the midst of a steep economic downturn, even though people I spoke with in the fluid power industry were still observing a healthy business climate. I addressed this in my “Editor’s Page” a year ago, and shortly after, the bottom fell out. So it appears that economic activity in the fluid power industry lags behind that of the general economy.
Learning of an impending recovery is good news because many of us have been wondering when the economy would hit rock bottom. However, most speakers at this year’s conference tempered the good news by saying that the recovery will be slow.
One of the popular speakers at the conference is Alan Beaulieu, of the Institute for Trend Research, Boscawen, N.H. (www.ecotrends.org) According to Beaulieu, our economy won’t begin an appreciable upturn until about mid- February of 2010. And even then, the recovery will be relatively slow — not achieving the economic level of December 2007 until perhaps the second half of 2012. Beaulieu implied that this is not good news for the immediate future, but he acknowledged, nonetheless, that we are entering a state of recovery, so businesses should prepare for impending growth.
So what should you do to prepare? Beaulieu described eight courses of action a business should take in the late stage of a recession and early stage of recovery.
Space prohibits much detail here, but he suggested:
1. Prepare training programs
2. If possible, negotiate union contracts
3. Develop advertising and marketing programs
4. Enter or renegotiate long-term leases
5. Look for additional vendors
6. Consider capital expenditures in light of market-bymarket potential
7. Make acquisitions — use pessimism to your advantage
8. People will be scared, so lead with a “can-do” attitude.
This advice is based on the fact that your company will grow, so you must prepare for this upturn in business. Training prepares your people, advertising prepares your current and potential new customers to recognize that your company is among the strong that have survived, and finding new vendors can enhance your production. Beaulieu also said that as the economy improves, other companies will be hiring, so take the necessary action to ensure that your key people won’t look to greener pastures.