IT’S THE ECONOMY STUPID – AN ECONOMIC OUTLOOK FROM SME OWNERS
"It’s the economy, stupid" was a phrase coined in Bill Clinton’s successful 1992 presidential campaign against George HW Bush. The message referred to the recession in the United States.
I am fortunate enough as a Business Coach & Mentor to conduct a rolling daily R&D project on the state of the economy through the eyes of a diverse range of business owners.
Here are their insights.
· Generally good trading conditions
· Low inflation & low interest rates advantageous
· If you can’t make money now you never will
· There is a talent shortage of experienced and driven mid-tier employees
· A perceived imbalance in unfair dismissal laws has resulted in some reluctance to hire employees
· Low wages growth has helped absorb margin pressure
· In boom industries, such as construction, there is high real-wages growth as a result of labour supply and demand pressures
· Businesses have an appetite for putting on contractors or outsourcing where possible
Banking & Finance
· Contraction in lending criteria by banking industry
· More scrutiny by banks on risk reduction in overall lending policy and increased conservatism
· Businesses feeling restricted by tightening in lending criteria despite them feeling that they have strong security and lending profiles
· Perceive high and ever-increasing customer expectations
· Experiencing margin pressures
· Getting paid the same or less for delivering more
· Customer focus on value-added services
· Focus on paying less for generic or compliance-based services
· Appetite for using more specialist consultants that add value
· Reviewing their selection of accountants and lawyers more regularly
· With low interest rates, appetite for risk present
· With lower investment returns on traditional investments, appetite for higher-risk higher-return investment opportunities
· Increased focus on property investment
· Appetite to reinvest profits into introducing new products or services that complement and align with existing business
· Feel invisible as mainstream media focus almost exclusively focused on corporate business despite SME businesses representing more than 90% of businesses
· Jury out on cost-versus-benefit and ROI on social media
· Feel alone, ignored and unappreciated for their role in the economy
· Act as unpaid tax collectors for government yet feel unsupported when tough times inevitably effect their business
· Increased scrutiny and tighter cashflow collection around indirect taxes such as GST, Payroll Tax & Stamp Duty
· As risk-takers, feel unrewarded by current tax structure
· Seek reform and support for SME businesses
These are the current thoughts, feelings and observations of what I am hearing from small and medium enterprises.
I support and acknowledge them as the dreamers and heroes that drive our economy.
To start creating sustainable success in your business and life, download a copy of my eBook 'The Success Algorithm' which details my process to work less and earn more. You can get a free copy on the Giveaways page of my website. Plus some bonus videos from my Fourth Moon video series to reach your goals sooner!
All the best,
Darren K Bourke
Connect with Darren on LinkedIN here.