I don’t have a crystal ball that will forecast the economic future for the rest of 2011. I have had several requests to share my views for the rest of this year, now that the first quarter is “history”.
First I believe that consumers are still hoarding money. They have the money to spend but are unsure about their own economic future. This directly affects us as small business owners since our customers are much more selective in their shopping; “maximum value for the dollar” is the battle cry and “don’t spend it unless you really have to”
The unemployment figures given to us by Washington tell us that we are just under 9%; In my opinion, if we add the unemployed, underemployed, those who have stopped looking for work and part time workers, the figure may be closer to 18%. This figure also has a direct bearing on the bottom line of small businesses.
The Fed keeps on printing money with the hope of stimulating the economy; personally, I have not seen much in the way of results.
As an owner of a real estate firm, I keep my fingers on the pulse of the industry. Lenders are still making it very hard to get a loan to buy a home. Many small business owners have had equity lines of credit taken away due to the drop in value of the homes. Small businesses that need a line of credit are finding it almost impossible to obtain the necessary loans to carry their receivables.
I don’t expect a double dip recession, but I also don’t expect a “V” curve where the economy will bounce back in short order. 2011 will be much like 2010 was and as small businesses we must plan our marketing with these factors in mind. Yes, a small business can grow in this climate, but management and marketing plans must be carefully thought out.
Don’t tell people what you are; tell them what you do!
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