I carefully observe what big business is doing, how they react to various situations and what we as small business owners can learn and adopt.

There are a few industries I  watch carefully as they mirror our economy and are very responsive to whats happening. One of them is the box industry. Think about it, everything gets put into a box, from every manufacturer, distributor. Thus what the box industry  does is a reflection of the entire economy.

Office supplies are another business barometer that measures America’s economic pulse, perhaps better then all, as everyone, every office, every student, every family, every retail store, every service provider, every manufacturer, buys office supplies.

Staple’s, the worlds largest office supply chain, doing a few billion dollars per year in annual sales revenue, has just released its numbers and are showing a 16% decrease in profits! That probably represents a huge decrease in gross revenue, maybe thirty percent or more.

One example they sited, as to what is happening, Staple’s largest corporate account, averaging $6-700,000. in monthly purchases, recently reduced its purchasing to $60,000 over two months. Wow! Is that a decrease or a catastrophic decline?

Here is the point, its not the decline I am interested in or concerned with, this we all know about, the point is what are the big boys doing about the crashing  economy we are experiencing, and what can we as small business owners learn by watching them. What they are doing is making massive adjustments, changes and redeploying their resources.

Starbucks closed 400 stores, Staples is immediately downsizing payroll, Toyota is a leader in alternative energy vehicles and has a diverse product mix that meets the needs of many different market sectors all over the world, maximising opportunities wherever they find them.

Here is the point, big business all know their numbers and track, monitor and control their business acuratly. They respond as rapidly as they can adjusting to the realities of the changing market place. They reduce costs and they adjust their marketing message to meet the changing needs of the market place and fight to increase revenue.

Most small business owners do a little of this, very little. They reduce costs where they can  but usually that just means reducing their ad budget. They tend to just keep doing what they have always done and pray for changes in the economy….like a deer stuck in the headlights of an oncoming truck… waiting to get hit…doomed.

The really interesting point is that it takes Staples or Toyota or Starbucks months to change directions and implement adjustments, during which time they bleed money. Unable to stop what they are doing and make changes as soon as they see the need. They do track and monitor their performance constantly and accurately, they ’see’ the issues but change is slow to come for the big boys.

Small business however can see a trend today and change tomorrow. That’s our advantage and its huge.

But while they can, small business seldom reacts as quickly as they should. They seldom make the hard decisions in advance of disaster. We are all guilty of closing the barn door after the horse gets out…rather then utilizing the power of swift response to changing conditions.

So the bottom line is first recognize when you are being negatively impacted and then  do something, do it now, today, not tomorrow and attack the issues on both sides, costs and revenue, and remember the largest cost you have is your payroll. But you can only win at this game if you employ a dual approach addressing the required changes at both the cost end and the revenue and profit end.

Do it today, what are you waiting for, the economy is not going to get better soon. What we see today is what we will have for a long while, long enough for you to make the changes you need today, and stop waiting for something to happen.

Call me if you want help in evaluating what can be done and in implementing strategies that will work for your business, 413-549-2966