There’s another way to look at ‘doom and gloom’

On every news medium we are reminded of the carnage in global markets. Banks are collapsing, governments are making epic financial contributions to the private and public sector and job cuts are increasing. Commercial and personal financing is harder to source and the amount and terms somewhat sharp compared to the last few years. Confidence is low and inflationary pressures have been driving up energy and food prices. Businesses are naturally concerned about surviving and the next few years are clearly not going to be an easy ride.

Most all of our clients – from hotels and casinos to bars and restaurants, are challenged like everyone else. The economic reality is inescapable. However whilst doom and gloom may be the flavor of the month, and for many months to come, that is not the only thing we see.  Arguably, a recessionary environment can provide a platform for innovation and economic growth through entrepreneurialism and creative thinking and we encourage our clients to take novel approaches to countering the downturn.

We are all suffering. Companies will continue to suffer and the insolvency practitioners are clearly going to be kept busy for much of 2010. People are spending less and selectively as disposable income is depleted or conserved in most economic groups. A difficult economic climate requires considerable ingenuity and the ability to look at things differently. And in looking at things differently, the reality is that there are many opportunities out there – opportunities not just for new business but also to improve existing businesses. When things are at their most difficult, you cannot just maintain – by doing that, you’ll in fact move backwards – you have to grow.

Along with a long list of sectors taking a beating, the world of hospitality and leisure is suffering. Bankers are calling in loans, rents negotiated in the ‘good times’ can be stifling and cash flow is constantly under pressure.

With thousands of sites standing empty, landlords and business owners must contemplate other sources of revenue generation to counter their existing challenges. What can they do in this climate if there are less customers, no customers, low spending customers or a business with a model that is currently untenable? Look at your stock, your financials, your customer base, your payroll and your marketing. Look at your margins – in your overall business all the way down to individual services and products. Take this opportunity to look at what makes you money, what draws in the customers and what is essential to the underlying business to ensure that when times improve, you have the infrastructure and team in place to handle that. At times, make tough decisions because you need to be lean to operate in this climate.

The message we give to our clients is be cautious but don’t be inward and conservative. Look outward and look differently at your business model, at your job remit and/or your skills and work hard to seek out where the prospect lies.

There cannot be any “sacred cows” or unchangeable tenements of your business, you have to look and relook at all aspects of the way things are done within your business.  Whether it’s redefining your customer, your product, your delivery method and or your staff, you’ve got to make the changes that make you undeniably viable; you cannot rest on past results or simply what’s worked for years.  The manifest of “Doom & Gloom” is not a given and in fact is only a reality if you allow your business to be stagnant and ignore the need to constantly evolve when times are toughest.