Utah Business Blog

By Mark Adams, Owner of Fruition Design

I noticed a certain sense of optimism in the air as March came to an end. And for the glass mostly empty kind of guy that I am, that is big deal. Perhaps it was that spring was in the air; not very likely (at least for those of us residing in the Salt Lake Valley). Or was it more likely the recent gains in the stock market (DJIA +300 for the week ending March 27^th)? 

Several year’s ago, I had the opportunity to visit Japan on a business trip. As somebody who does not travel outside of the U.S. very often, I found myself enamored with the Japanese’ view of America, and American business. One thing that struck me was the Japanese’ long-term view on life and business. Perhaps this is rooted in their religious beliefs. Never the less, it was quite obvious that they had a less narrow minded, more systemic approach to their decision making process. A Japanese businessman said to me “you Americans have a very short attention span my friend”. 

I often think back to the Japanese view, and that quote, when I see the pendulum swing so violently as it has recently in the market. Listening to the economic pundits lately, one might think that the worst is now in our rear view mirror. If that opinion is the majority, than I would argue that we have learned nothing. So if we have indeed hit bottom and are rebounding upward, should we go back to business as usual (and employ the business practices of old)? 

Part of my optimism  was caused by the fact that my phone did not stop ringing. It seemed as if the orders were rolling in. To be honest, March seemed to have come in like a lamb, but was going out like a lion. While part of me wants to run out and hire more staff, I need to check my ego at the door. Have I learned nothing in the past year? 

With that said, I am now in a “wait and see” mode. But how long do I wait? What is a blip on the radar, and what is an upward trend? How does a small business owner know when he experiencing an anomaly, or when he is really on to something? I haven’t got much of a clue. All I know is that I will try to think more like a marathoner and less like a sprinter. Domo oregato.  

The views and opinions in this blog post are solely that of Mark Adams and do not necessarily reflect the views and/or opinions of Utah Business.

By Dave Young, President of Paragon Wealth Management

For many, a down economy typically translates into a downer mentality. This volatile market can be overwhelmingly discouraging, which leads people to sit at the kitchen table with their head in their hands, saying, “Tell me when it’s over.”

The good news is it doesn’t have to be this way. A less-than-ideal economy can lend itself to a better-than-ever situation. All you have to do is plan for it.

There’s no denying the economy is in trouble or that people are seriously struggling. The market has been obliterated over the last few months, coming in at levels it was 11 years ago. The world has been turned upside down.

The market, essentially, has gone through nature’s equivalent of the “100 year flood.” Meaning, that this downturn was one of the worst in the past hundred years—-excluding the great depression. And because of that, it’s more important than ever to be alert and proactive. That deer-in-the-headlights mentality isn’t going to do you any favors.

Stocks have gone down, and they’ll go back up. We just don’t know exactly when. So it’s essential to evaluate your options and look to the future.

The market is often described as psychology in motion. It’s all based on confidence. For example, going into the election, consumer confidence was down. The politicians were telling people how bad things were, and they were scaring everyone to death.

Then we elected the new president, and consumer confidence went up 11 points—that day. President Obama didn’t do anything yet — but the perception of what he might do positively impacted the consumer confidence numbers.

The bottom line, is when confidence leaves the system, everything comes to a standstill. People stop spending because they’re scared — despite the fact that they still have a job and their paycheck hasn’t changed. The right move, however, is to do the opposite. Normally, we have to scour for the kind of deals you can find in today’s market. But now the situation is akin to someone pulling up with a dump truck full of bargains and leaving it there for the taking.

Taking advantage of the incredible bargains requires strategy and forethought. You can leave it to random luck, or you can strategically position yourself for great returns. This may be the way to make lemonade out of lemons. Now is the time to position yourself in a way that allows you to capitalize on an opportunity that rarely comes along. UB

Despite what you may think, starting your own business in a recession offers opportunities

By Joseph R. Cardamone, President, United States Federation of Small Businesses (USFSB)

Often times, the monotony of punching the clock as someone else’s employee leads to day dreams of starting a business and being your own boss. In rough economic times, those day dreams may never pass beyond imagination. “Times are tough, how could I start my own small business now?” one thinks. That’s rational thinking, but, counterintuiviely, a down economy can actually create great opportunity for budding entrepreneurs.

There are a variety of benefits to starting a small business during poor economic conditions. For starters, office rents could be lower and suppliers may cut better deals. Downturns are a great time to sign new accounts. Customers are examining every expense for ways to save, including asking eager entrepreneurs for price bids in order to replace current and expensive vendors.

An unfortunate reality of hard times is increased unemployment. But, for small business owners, this means more experienced talent is available in the marketplace, with more affordable salary requirements.

However, as you can imagine, the grass isn’t all green for entrepreneurs making a start in a down economy.  It’s tough, very tough.  A down economy means tighter lending standards, higher prices on energy and food and weak consumer spending. Like those millions of entrepreneurs who started a business during the recession of the early 1990s, today’s dreamers need to ask themselves if they have the appetite for risk and fire in the belly to succeed as a small business owner. For those inspired to give entrepreneurship a go, here are some quick tips for starting a small business in poor economic conditions:

• Avoid the middle market products and services – Even in a down economy, consumers and businesses need necessity-based products and services – office supplies, tech services, food, medical assistance, waste management, etc. Conversely, an innovative luxury item can also be successful. Avoid the middle ground; if customers can delay purchase while times are hard or choose a less expensive alternative, that’s not the industry to be in.
• Don’t fret the big bucks – If start-up capital is an issue, consider starting a part-time business. Keeping a day job for a while can help maintain a steady income while waiting for sales from the new business venture to kick in. It’s also a smart way to work out kinks, gain industry knowledge and build a solid customer base without superfluous financial stress and pressure.
• Make equipment multitask – Technology products are getting smarter and helping people streamline. Many printers can also scan and fax. Another printer, the DYMO LabelWriter printer, both prints a variety of labels, and enables users to purchase postage online through DYMO Stamps. This enables professional looking mailings, without the commitment or expense of leasing a postage meter, all while saving trips to the post office.
• Strategize staff selection - Minimize full-time staff. Hire part-time employees. Contact the local college or university to see if they offer a formal internship program. In some states, interns can work for free or class credit only. Outsource or hire freelancers who can take overflow work or specialty jobs. Don’t invest precious resources employing people who may be underutilized. As business grows, you can consider adding more full-time employees.
• Embrace the guerrilla – Don’t spend a fortune on advertising. Use guerrilla marketing techniques to get the word out. There are hundreds of free or inexpensive ways to do business promotion: Distribute free product to attract people and secure repeat customers. Write a column for the local newspaper. Get involved with your local chamber of commerce. Network with other area business professionals. Display the company logo on a vehicle.
• Buy the business – Many businesses for sale are completely viable; the current owner has simply run out of time, energy or entrepreneurial passion. Although it may cost more up front, the purchase of a business can provide an existing foundation and income stream - ready to be nurtured and advanced to a higher business level.

Anytime can be the right time to launch a venture if the opportunity is right. During periods of a challenging market, big companies suddenly don’t take any risks; they retrench and bunker down. In contrast, entrepreneurial start-ups, small and agile, are out reinventing models. Great ideas, some savvy business sense and a passion for self-employment can overcome any type of economy. Good luck!

Joseph R. Cardamone is president of the United States Federation of Small Businesses (USFSB). Founded in 1983 by small business owners, USFSB advocates for the rights and interests of small businesses and the self-employed. Their mission is to help their members grow and prosper by joining together and effectively promote small business interests before local, state and federal lawmakers.