The greatest change that seems to take place in the recovering U.S. economy is an aging population with low level of spending due combined with a high level of unemployment, low growth in consumer incomes, and difficulty to obtain credit and the high interest cost credit.
On the other hand there is an increasing demand for products and services that have not been a priority during the recession. It is expected that this demand will increase as unemployment from the current high levels improves over the the next sixteen months. However, consumer growth in spending will very likely stay below 4% the historical levels.
In a low level demand and more difficult credit environment, small businesses can move on successfully by being aware of the following and acting accordingly:
- Tighter and expensive credit will require businesses to pay more attention to managing cash flow.
- Increased emphasis to asset turnover to reduce working capital.
- Companies must employ tight cost control and planning to keep profits at desirable levels.
- Businesses must revamp their management and distribution systems and strategic plans.
- Businesses must continue to outsource and use technology to reduce labor and distribution costs.
- Companies should make a priority online marketing to increase sales efficiency.
- Businesses should get into partnerships with other firms to share costs, improve product and services.
- Companies must be able to be more integrated solutions providers and offer real value to customers.
- Management structures must reduce management expenses and improve their lines of communications and clarify responsibilities.
- Must address worker training needs. Companies must increase employee productivity. Employees must be able to do more than the past restrictive job description allowed.
- Successful businesses will have employees that are more thoroughly informed.
- Top rate customer service will be the hallmark of successful businesses.