Are you planning for post-2010 ?
Some financial commentators are predicting a 'Lazy W' economic recovery for South Africa. 2009 saw us plummeting down the steep slope of the downturn, and we are now heading towards a somewhat shallow middle spike, centred on the economic stimulus of the upcoming FICA Soccer World Cup. Then that peak is likely to take another dip before we move slowly up a gentle gradient for the last stroke of the W during 2011.
What does this mean for entrepreneurs? There is the danger that the anticipation of the business opportunities on offer during 2010 could be obscuring the bigger picture. Rather than relying too heavily on the benefits of 2010 – focusing too narrowly on the central spike of the W – entrepreneurs need to have their antenna out for the opportunities that will come up in the longer term, as we enter more sustained economic recovery.
Whilst many companies were sliding down the slippery slope of 2009, my small business partners enjoyed a bumper year. Why? Because we focused on finding new opportunities that emerged during the crisis and ensured that we had the necessary flexibility to take advantage of these. Like the short trader who finds ways to profit from a declining market, small entrepreneurs need to be on the ball to adapt to market conditions.
Venture capitalists are reputed to like recessions because they say that the best companies are started during economic downturns. Just Google the subject and you'll find loads of information about some of the world's most renowned companies that started up during tough times. The common factor in all such cases is that innovative entrepreneurs recognised a market need and filled it.
Indeed, this is the foundation of entrepreneurship – we cannot succeed in business unless our first focus is on providing what our customers want. So you should not be acting differently during a recession or an upturn. No matter what the circumstances, the entrepreneur's primary goal is to maximise on the opportunities that are available.
If you take your eyes off the current construction boom in the World Cup host cities, and the impact of half a million visitors to South Africa during June or July, and look ahead to another dip by the end of the year and a slow recovery after that. What will this mean for your business? How do you plan to meet this challenge? What needs are likely to arise in your sector? Now is the time to be planning for these opportunities.
Challenge for the week
Plan for the future |
