A recurring conversation I am having with business owners and leaders as we continue in the part “limbo” space of the economy right now is to invest now for the coming recovery.
“Last year I was able to take a whole lot of time in my garden. I even planted bulbs for the very first time last Autumn, and now they are sprouting and we are seeing the colours of spring!”
a conversation with a friend last week
As in the photo above from two weeks ago and my conversation last week, bulbs are sprouting into beautiful early spring flowers now, but only because they were in the ground from many months or years ago.
Now, a recurring conversation I am having with business owners and leaders as we continue in the part “limbo” space of the economy right now is to invest now for the coming recovery.
“Someone’s sitting in the shade today because someone planted a tree a long time ago.”
Warren Buffett, the greatest investor ever (IMO!), with one key to that being to take the long term view. As he says: “my preferred holding period for an investment is.. forever”
For businesses, I am not talking about the time horizons Buffett talks about, but more the 4-6 months or so one needs to plan ahead in order to plant bulbs in the Autumn before the ground gets cold in order to see them sprout when the ground warms again.
Before I go on to explain my predictions and give recommendations, I encourage business leaders reading this to book a call with me, I’m here to listen, then to reflect and to therefore support you in looking at “What Comes Next”. I’ve love to be overwhelmed with such calls in the coming months, supporting people and businesses to reach their potential is what fulfils me! Book your call here
Be ready for the boom in Summer/Autumn 2021
Economically, for many sectors, by Summer or Autumn this year we will not just see buds sprouting, we will see an explosion of growth. A massive amount of movement in the economy is driven by human behaviour, so with the high probability (in the developed world, at least) that vaccinations will see a high degree of freedom of activity happen by summer, this will (predictably) unleash a torrent of pent up demand for items of discretionary spending (from clothing, to eating out, entertainment, events, travel and more).
(Here I pause to acknowledge the gross inequalities and inequities in the world right now. What I am talking about is that those who are in a position to spend, will spend and spend mightily. I am encouraging businesses in a position (strong Balance Sheet and in the right sector to thrive from this consumer spending) to invest, that they do so, as this also is good for the economy, jobs and more (we need the virtuous circle of business investment and consumer spending to drive the economic recovery)
Will you act, or will you wait? (hint, Act Now!)
Why am I emphasizing my prediction around the economy and that this is time for businesses to invest?
I am doing so as I have been a business owner and leader through multiple tough times, natural disasters, recessions, and the key moments for our businesses at those times were when we could lift our heads out of working “in” the business (on keeping things going in tough times) to work “on” the business, to look strategically at what we will need to have in place when things recover in the economy.
Be that business leader who takes that time to look ahead, rather than waiting and missing out.
So, where to invest?
There are many areas, one area I will highlight that is consistent it to invest in your people.
If things take off for your business, you will be tied to the ground and miss the opportunity for the rocket ship ride if you don’t have the people (and enough of them!), with the right skills and the energy and solid personal foundations (not physically, financially, mentally overstressed after all this pandemic time) they need to be able to focus on being part of your team that is there to deliver to your clients and customers.
Yes, you may say, but we’ve been furloughing and making people redundant for a year now, our teams are shrunken down to cut costs for our diminished revenues. Yes, that is a terrible consequence of the pandemic in many sectors having massive human impact. However, many business leaders will remain fixed in this cost cutting mode for too long, rather than finding a balance between stable financial stewardship and bravely looking to the future.
Imagine you own a restaurant
I’ll close with considering some of my favourite restaurants in and around London. Few sectors will have had it so tough, yet few sectors will see such massive demand come the summer and autumn.
For restaurants this is indeed time to invest for that future, as those that are ready, with great staff who can handle the huge demand whilst gelling as a team and delivering amazing customer service, well, those restaurants will both profit greatly from the initial boost of spending, but also have built a foundation in customer experience and loyalty that will plant the seeds for more flowers to bloom into the future.
One particular favourite restaurant has taken the “bravery pill” and has, for months now, been in the process of getting ready to open their second location once lockdown eases. They have been very successful in their first location and so have been thinking about expanding for some time, but they made the decision to “pull the trigger” on their investment late last year once they could see the speed of the vaccine rollout strongly indicating an opening up by Summer and Autumn 2021. Oh, and after securing a location, what was the first thing they did? Promote one of their long serving staff to manage their original location so the founder could focus on the new opening. Oh, and they announced that promotion to all their loyal clientele. Imagine how that made the newly promoted manager feel, all their colleagues, plus the loyal customer base? A great example of investing now for the coming recovery, and of focussing that investment in their people!