Growing companies see downturn opportunities
Article Date: Jan 02 2009
Some firms will benefit from the slump
Companies from five to nine years old are the best placed to benefit from the downturn, according to research from accountancy firm Tenon.
Some 37 per cent of such companies say the slump has provided opportunities for them, compared with a national average of 29 per cent, according to the firm’s survey of 1,264 small and medium-sized enterprises (SMEs).
Businesses that have been up and running for more than 20 years are the least likely to have seen benefits (26 per cent).
Carl Jackson, head of Tenon’s business recovery division, says that SMEs of between five and nine years old may not have experienced a downturn in the past, but they often have sufficient experience to make the right decisions.
He adds, ‘[Longer] established firms have the experience but often lack the flexibility to make significant changes or system overhauls.’
The businesses most likely to prosper in 2009 are online retailers, repair services, pawnbrokers and outsourced service providers, according to Tenon’s predictions for the new year.
Leisure and hospitality, property, retail, travel and the automotive industry are the sectors most likely to suffer.
Companies are certainly set for choppy year ahead, but we've all been there before and worked through it. 2009 is a year to manage businesses prudently and sow the seeds for the future. Everyone can manage a business in boom times. Consumers consume, suppliers grow, and people make experimental purchases that are surplus to requirement, but may work.
We are now entering a time where consumers will conserve, suppliers will retrench, and there will be less money in the economy for experimental purchases. So how can we thrive?
This is the era for good management. We need to operate in markets where one can see the future, maybe not a lot into the future but a bit, and we will need to take proactive actions to prepare for what will be coming our way. Do not be fooled into thinking this is easy, but if you are married to your market it is not only possible but probable that you could significantly outperform your competitors and thrive in a time when others are suffering.
So get closer your market, take soundings to read the future and believe in your intuition. We are all in a supply chain of some form and can read the signs coming down the chain from the end consumer. It's just a matter of interpreting the signs and taking actions ahead of the market.
Manage your business well, act in a timely and effective manner and you will thrive when the turnaround comes, as it surely will.
Best wishes for the New Year!
Rose Lewis, Partner, Pembridge Partners LLP, London
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