Tag Archive for 'small business economy'

It Was The Best of Times, It Was The Worst Of Times

Contemplating the current economic and entrepreneurial conditions out here in Main Street America, I keep thinking about this perfectly paradoxical passage from one of the great literary masterpieces:

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.”

Perhaps you recognize the opening paragraph from A Tale of Two Cities by the immortal Charles Dickens. He was providing analysis of the disruptive state of affairs in 18th century England, as well as across the Channel, in France. If you know about the disruptive state of affairs in the 21st-century marketplace, perhaps you’ll appreciate the allegorical reference of these phrases for small businesses almost two and a half centuries later.

It was the best of times: “The more high tech we have, the more high touch we will want.” The reason John Naisbitt’s 1982 words will always be prophesy is because humans will always be analog beings. There’s never been a time when the high touch leverage of a small business has been more powerful against the high tech of big competitors.

It was the worst of times: Tech behemoths like Amazon, Google and Facebook are increasing digital leverage to create new customer experiences and expectations. This trend is deadly for those hidebound small businesses that won’t infuse their sublime high touch with incremental high-tech to produce irresistible, Main Street special sauce.

It was the age of wisdom: Unlike the 20th century, today there are few hidden rules or proprietary tools employed by big businesses that aren’t available in some form to small firms. Digital leverage and data are increasingly available in incremental and affordable forms, but you’ll have to risk what you know for what you might learn.

It was the age of foolishness: In the most transparent era of management fundamentals, the keys to sustained success are lower than low-hanging fruit – they’re on the ground. And yet, innumerable small businesses are following Sears and Macy’s into the realm of irrelevance rather than adapting to new customer expectations with high-touch intangibles, relevant 21st-century practices, and affordable – many free – new tools.

It was the epoch of belief:  In many ways, the path to entrepreneurship has never been easier. A sweet byproduct of democratized digital leverage is a lower capital barrier to entry. Plus, the expansion of the universe of niches (read: niches of niches) is creating unprecedented small business opportunities.

It was the epoch of incredulity:  It’s still easy to start a new business, but it’s never been more challenging to sustain one. New and evolving customer expectations must be served with fresh data and effort – every day. And competitive disruptions are emanating from improbable market sectors.

It was the season of light:  The illumination and availability of customer data for small firms is unprecedented. Extensive information about business prospects is opening doors to the now-illusive, face-to-face appointment. And response behavior of retail prospects is available to help design and deliver a high tech/high touch marketing strategy.

It was the season of darkness:  At the same time, qualifying a suspect into a prospect into a customer has been disrupted by a more informed prospect base. As the selling cycle lengthens for those who fail to recognize this shift, diminishing gross profit erodes equity, burns available credit, and then – well, you know.

It was the spring of hope: One of the most amazing forces in the marketplace is the pathological optimism of American entrepreneurs. Against all odds, they navigate their dreams around the wreckage of peers that were sunk by the reef of disruption.

It was the winter of despair: I never thought I’d see conditions that would so restrict the entrepreneurial energy of America. The past decade saw anti-business political policies, unprecedented demographic shifts and behaviors, distressed economic conditions, and restricted capital and disruptive pressures combine to set back entrepreneurship in America for the first time in generations (Kauffman Index Startup Activity).

The human experience is pregnant with paradoxes, and no sector more so than the marketplace. Digital leverage is at once creating the paradox of exciting opportunities and unprecedented disruptions.

You would be correct to point out that humans have lamented change for millennia, but this really is different. Not change itself, but the velocity – the compression of time between changes.

Past changes have occurred at the velocity of analog – the speed of sound (761 miles per hour). Today’s change is powered by digital – at the speed of light (186,000 miles per second).

Are you adapting to new expectations with your high touch/high tech special sauce? Or are you being disrupted on the way to – well, you know?

Write this on a rock … The best of times or the worst of times? The choice is yours.

Video - What’s good for small business is good for the world

Check out my latest video about how small business could turn the economy around.

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The Blame Game

Recently, in the Small Business Advocate poll, we asked this question: Who do you think is most responsible for the current state of the U.S. economy? Here are the results:

27% - Congress

18% - President Obama

55% - Both

Jim’s Comments:

Lately, we’ve been asking what you think of President Obama’s attempts to create jobs in America. Some of our audience members said, “Hey, you’re picking on Obama - what about Congress?”

Well, there are at least two reasons why we don’t think we’ve been picking on the prez:

  1. He’s the president. It’s his watch. He asked for the job. To paraphrase President Truman, he occupies the desk upon which the buck stops.
  2. He has put his jobs plans right out there, expending a lot of words and taxpayer money on various jobs programs of which he has taken full ownership.

Nevertheless, we do agree that Congress shouldn’t be left out. So last week in our online poll, we asked this question: “Who do you think is most responsible for the current state of the U.S. economy?” Here are the results.

All by himself, President Obama did better this week, with only 18% of our voters putting all of the responsibility for our troubled economy on his shoulders. The 535 occupants of the big building on the other end of Pennsylvania Ave. faired a little worse, with 27% of our respondents blaming Congress.

The big number was reserved for Team Politic. More than half of you said both the president and Congress were to blame for the economy, which includes the worst sustained unemployment conditions in generations.

I’m not trying to be controversial, but with these kinds of numbers so close to the next election, and with the economy not expected to improve dramatically over the next 13 months, I’m predicting a major housecleaning in all three houses. Not along party lines, but along the lines of the political class - members of both parties who have long forgotten what they were sent to Washington to do and who they were sent to represent.

For my part, it’s about time.

I talked more on The Small Business Advocate Show about who is to blame for our current economic troubles. Click here to listen or download what I have to say, and while you’re there, see what other people are saying about the economy.

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The Dec 09 NFIB report of small business conditions

The recession may be over technically speaking, but that’s not how it feels to most small businesses on Main Street.  They’re still having a tough time getting enough customers to show up to grow sales and profits, and are not looking to make capital improvements or hire new employees to any great extent. 

It distresses me to report on this kind of news, but my job, as legendary sports announcer, Howard Cossell, used to say, is to tell it like it is. I believe 2010 will be a better year than 2009, but it doesn’t feel like that right now for many Main Street small businesses, especially retailers.

Of course, much of the small business conditions I report on comes from the high quality, peerless research of world-class economist, Dr. William Dunkelberg. Bill is professor of economics at Temple, chief economist for the NFIB and an invaluable member of my Brain Trust.  I used the word “peerless” earlier in referring to Bill’s work.  He has been tracking small business sentiments every month since 1971, throught all of the marketplace cycles. Any questions? 

Recently, Bill joined me on my radio program, The Small Business Advocate Show, to discuss in detail the results of the Dec 09 NFIB’s Report of Small Business Economic Trends.  Take a few minutes to listen to this conversation and, as always, leave your own thoughts on the status of the economy as it relates to your business. Listen Live! Download, Too!

Jim Blasingame’s 2010 crystal ball predictions

This year marks the 10th year of my Small Business Advocate Crystal Ball predictions. For the first nine years, my accuracy percentage has averaged 70%, including 13 for 16 in 2009. Take a look and see what you think about how I will do in 2010.

2010 Prediction: The fragile economic recovery will continue at a marathon pace with steady annual GDP growth of between 2% and 3%.

2010 Prediction: Surviving small businesses will have fewer competitors due to recession casualties and fewer start-ups.

2010 Prediction: Big business layoffs in 2008-09 will produce small business opportunity in two ways: less competition for customers and outsourced business from the big guys.

2010 Prediction: Reversing the 2009 trend, growing small business loan demand will signal Main Street recovery.

2010 Prediction: Improved balance sheets and TARP repayment won’t cause large banks to increase small business lending.

2010 Prediction: Community banks will continue to increase as the option-of-choice for small business growth capital.

2010 Prediction: The multifaceted challenges of the real estate triumvirate of housing, mortgages and commercial will continue to produce significant economic headwinds.

2010 Prediction: The second jobless recovery in a decade will result in unemployment above 9% at year-end.

2010 Prediction: Diminished consumer credit, combined with a new aversion to debt, will stunt economic growth.

2010 Prediction: U.S. stock markets ended 2009 flush due to earnings based on expense cuts, not revenue growth. This scenario will not repeat in 2010.

2010 Prediction: So called “health care reform” legislation will be signed into law along strict party lines.

2010 Prediction: Election-year realities will cause Democrats to forsake their leadership’s goals for pro-union and cap-and-trade legislation.

2010 Prediction: Republicans will increase seats in both houses without gaining control of either but will win a filibuster minority in the Senate.

2010 Prediction: The federal government will intervene to keep California out of bankruptcy. New York will follow.

2010 Prediction: Under pressure from within and without, a desperate Iranian government will take steps that disrupt geopolitics and global markets.

2010 Prediction: Recognizing the power of community building technologies and practices, small businesses will increasingly leverage these tools to find new competitive advantages.

2010 Prediction: With increased product information and user experiences available online, The Age of the Customer has begun. More customers will choose businesses offering online platforms that promote dialogue and deliver targeted information.

Finally, continue to expect a deliberate, marathon-like recovery.

I talked about these predictions in more detail recently on my radio program, The Small Business Advocate Show. Take a few minutes to listen and let me know what you think about my prophecies. Listen Live! Download, Too!

2010 economic forecast and the impact of government on it

What is ahead of us with the economy and how much will government policies impact the recovery? Bill Brandt joined me today on my radio program, The Small Business Advocate Show, to discuss the dynamics of the economic recovery between the solutions we should naturally expect from the marketplace and the artificial, and often harmful, effects of government intervention.

A long-time member of my Brain Trust, Bill is President and CEO of Development Specialists, Inc., a firm specializing in the consulting and turnaround assistance to troubled or reorganizing concerns. Take a few minutes to listen to this interview and, as always, leave your thoughts on the way the federal government is attempting to influence economic recovery. Listen Live! Download, Too!




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