World and Economic Factors Can Hurt Your Business

Business



The news has been filled with stories about countries and states that are having serious financial difficulties. Some are considering filing for bankruptcy. Others have been affected by wars or natural disasters and are depending on others to help them. Like it or not, we are in a world where the things that affect one area also have an effect on our lives and businesses.

Lack of overseas markets - There are so many things that can kill what might otherwise be a good customer base. Tariffs or import policies can reduce trade when political leadership changes or relationships between countries deteriorate. When a country is suffering financially, the people also suffer and may not be able to afford the products that you have to offer.

Lack of domestic funds - When a government is seriously in debt, there are often cutbacks that not only affect funding for national programs but also trickle down into a rise in unemployment that affects individual families. Unless your products and services are considered necessities, you may be the business who suffers the most when people cut their budgets and set their priorities.

One of the most powerful emotions that people experience is fear. During the 1929 stock market crash, many suicides occurred when investors were too afraid to face the future. Those who fear that they will live in poverty can begin hoarding their money and, if enough people do this, it can also cause world and economic factors to further deteriorate.

So, it is the old story about "chicken and egg". The world and economic condition affects everyone but the behaviours of everyone also affect the world and economic condition.

If you want to recession-proof your business, you therefore will need to consider what people will need when times are tough. Those in United States real estate markets would likely never have guessed that thy would have a housing crisis that would drop prices in some states to almost half of their previous value. On the other hand, grocery stores have actually experienced situations where they have empty shelves and line of people who are desperate to feed their families even when world and economic factors are not at their best.

When you write or review your business plan, it is therefore very important that you not just think about how things will be on your best day but also how you might be able to expand your products or services so that you have revenue when the world is having one of its worst days.


Dr. Linda Hancock, the author of “Life is An Adventure…every step of the way” and “Open for Business Success” is a Registered Psychologist who has a private practice in Medicine Hat. She can be reached at 403-529-6877 or through email office@drlindahancock.com


Older Post Newer Post


Leave a comment

Please note, comments must be approved before they are published