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ยป Business must adapt to survive in the new economy
Date published: 04/06/2011
Business must adapt to survive in the new economy (and so must YOU!)
Business must adapt to survive in the new economy (and so must YOU!)
The government has given stimulus packages to get the economy moving again, but it mostly went to those on pensions or allowances and those in power did not give much towards supporting local businesses or adding sustainable value to the economy.
This could mean that a fair whack of the $900 grants may have ended up being put into plasma screen TVs, cigarettes, alcohol and poker machines instead of being invested into areas that could create sustainable local employment.
(If you are a government minister or loyalist and want to beat me up for my simplistic political or economic views, you are going to have to take a number and line up behind the rest of the politicians. By the time you get to the front of the line, your party may well be out of power!)
After being in business for twenty-odd years, I have learned that governments come and go, policies come and go, politicians are temporary but a good business can last a lifetime.
There are numerous businesses closing down at the moment and for every one who closes its doors, another dozen are affected. If the business stops trading, its rental money no longer goes into the local economy, the staff remain unpaid and their wage money does not circulate as expenditure into other local businesses.
The money-go-round stops and the whole local economy starts to tumble like so many dominoes in a row.
Although many business owners are doing it tough, there are still three quarters of the community who are receiving the same or similar wages that they were on before the GFC economic downturn. These people still have money to spend; they are just not spending it in the same way that they used to do, pre-GFC.
Realising that most people have the same income but are spending their money differently, a business now has to market to these people differently. What can you do differently to succeed?
Adapt or Perish!
Evolutionist Charles Darwin pointed out many years ago that it was not the biggest species who survived best after a climate change, nor the strongest: the species who survived was the one who was most adaptable.
In an economy that is post-GFC, post-9/11, post-property market stall, post stock-market crash, post-earthquake, post-tsunami, people are looking for different things than they were three years ago or even 12 months ago.
The two big friendly giants that control up to 80% of our spending are changing the economy even as you read this. Did you notice how quickly Caltex and Shell put fuel up from $1 to $1.30? Fuel was $1.20 just prior to Christmas and it took just 12 weeks for fuel prices to go from under $1.30 to over $1.44 (ref. Australian Institute of Petroleum).
Of course, Woolworths (Caltex) and Coles (Shell) decided to do the community a favour by reducing the price of milk back down to $2. A nice gesture to help the cereal-for-breakfast crowd, but in my household we use a lot more litres of petrol than we drink litres of milk!
Thanks Coles & Woolies: I can now save around 20% on milk that I use only a smidge of, whilst I pay 40% more for the tank of fuel I need to go to work or to go grocery shopping. By my calculations, it has cost me $45 to save $0.47.
But do you want to know the dirty little secret? The $2 milk may not be the same batch of milk that you used to get for $2.47 six months ago. It may have been watered down with whey, a cheap waste by-product of cheese production. Because whey is made from milk, the ingredient label does not have to say anything has been added to the milk (if it used to be milk we can still call it milk). The $2 bottle of milk may be inferior quality to its older rival. Try it and see.
The good news about all of this is that in the new post-trauma economy, people are not looking for simply cheaper fuel (ethanol, anyone?) or cheaper milk (tastes whey different to me).
People are now seeking: VALUE.
If a business sells cheap products that may be inferior, expect a short shelf-life for the product and for the business. You must be adding value, authentic value, for your business to succeed in the new economy. Buy Australian made if you can, buy Chinese made if you want to, but buy something that will give you good value. Replacing cheap light bulbs, budget batteries or buying new $5 T-shirts every six months is not economically viable.
Of course, if you are in the workforce and not in business, you also need to be adding value in order to keep your job. With increased unemployment, there are probably many candidates out there who would be willing to jump through hoops of fire to get your job.
The best way for you to keep your job (or find a better job) is for you to study, apply yourself, develop yourself and add more value than what you are being paid to do. As you sow, so shall you reap: send out more value and you will find more money returns to you.
In this way, you add more value to the position, you add to your own personal economy and the money will flow more quickly and more powerfully in the direction which you want it to go. Towards you!
For more information, or to discuss your specific situation, please contact me directly.
Jeremy Britton
24HourWealthCoach
Jeremy Britton is an independent wealth coach and business coach who likes to KISS* (Keep It Simple, Sweetie). He advises businesses and professional clients on enriching themselves, their families and their world with simple, effective strategies. For free education, see his youtube channel or 24HourWealthCoach.
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