Fundamentally Sound
Joseph M. Carbonara, Editor in Chief -- Foodservice Equipment & Supplies, 8/1/2008 12:00:00 AM
|
|
Joseph M. Carbonara, Editor in Chief |
Economists across the land continue to debate whether the United States is in a recession. The optimists in this group cling to the textbook definition of a recession, pointing out that the economy has not seen two negative quarters of growth and point toward a softer economic landing than previous years when times got tough. The pessimists point to a seemingly constantly shrinking economic growth rate as proof positive that the U.S. is indeed in a recession.
As the economists do battle over semantics, individual business leaders are left to come to terms with the one thing everyone can agree upon: that today’s business climate faces some real challenges that will not disappear anytime soon. How the current challenging business climate manifests itself in the foodservice equipment and supplies industry represents a scenario that continues to play itself out.
When I am on the phone these days, everyone wants to know what the other guys are saying. Hopefully, our forecast update article, which begins on page 29, will take some of the uncertainty out of the conversation. The basis for this feature is data supplied by you, the readers of Foodservice Equipment & Supplies. And our intent is to help create a larger context of what’s actually happening at street-level in the industry and provide you with some data points that will allow you to benchmark your business’s performance.
While information such as this is much sought after these days, foodservice professionals should not use it as an excuse for letting the fundamentals of their business lapse. Too often companies get caught up in what’s happening around them and lose sight of what’s actually in front of them and what they can control.
|
"Every Market is and always will be susceptible to enduring some peaks and valleys in its performance and foodservice is no exception." |
For example, if you claim yours is a relationship business, as many in the foodservice industry do, then the need to continue to meet face-to-face with customers will not lessen, particularly during periods of economic uncertainty. Many times with the business climate such as it is, companies will severely cut back business travel with the hopes of saving money. This is the business equivalent of someone looking to make rent by collecting the loose change from between the cushions of their sofa. True, you might strike pay dirt once in a while, particularly if your rich uncle recently visited, but it’s not a sustainable approach that will make paying next month’s rent any easier.
You need to meet with your customers regularly to understand their pain points and potential for expansion. That way, when the economic climate improves, you and your customer will be ready to move forward at full speed and not waste any time wondering how to meet the increased demand.
In addition to knowing your customers and the challenges they face, it remains equally important to understand the internal workings of your business. Develop a more intimate knowledge of your cost structures and value proposition and continue to refine them so they meet customer demands and support your company’s mission, vision and values. This gives you the ability to evaluate opportunities through a prism shaped by those attributes that remain essential to your company’s continued growth and success.
The most fundamental mistake people make about the economy is expecting it to grow in perpetuity. Every market is and always will be susceptible to enduring some peaks and valleys in its performance and foodservice is no exception. The companies that minimize the impact of the valleys and maximize the positive effect of the peaks are those that remain fundamentally sound regardless of the market conditions.
|
|
joseph.carbonara@reedbusiness.com |
VIEW ALL GALLERIES
