“There is no question that business is tough … [but] the glass is half full.” –Steve Myers, Moser Motor Sales Inc.
I gave into the gloom permeating the trucking industry yesterday, but thankfully, longtime reader Steve Myers out in Berne, IN, at Moser Motor Sales Inc. – a Ford Motor Co. dealership – set me straight.
As he’s reminded me on more than one occasion (his quote above being only the most recent), yes, things are bad, but there are actually a lot of good things going on right now – so if you knuckle down and start pulling on the oars, instead of just throwing up your hands and giving up, things might actually get better.
The second annual FedEx Office “Sign of the Times” small business survey reveals that a similar mindset seems to be settling into place despite the still-toiled economic waters. FedEx Office, along with Ketchum Global Research Network and Braun Research, conducted 500 interviews back in early February with small business owners that employ 5 to 100 employees and generate over $100,000 in annual revenues.
FedEx Office’s survey found that 54 percent of those small business respondents were very concerned about the current economy’s impact on their business, with another 39 percent saying they were “moderately concerned.” Despite that anxiety, however, 75 percent of those polled were confident they will be open for business at this time next year and almost half (46 percent) said they would be willing to open another small business today if they had the proper financial backing.
“Given the continued contraction of the marketplace, it’s not surprising the small business outlook has worsened over the past year,” said Brian Philips, president and CEO of FedEx Office. “Yet, despite increased concerns, many small businesses are cautiously optimistic and that is a positive sign that Main Street can emerge from this downturn.”
Now, sure, drawing broad economic conclusions from a survey of 500 small business owners is a stretch, no doubt about it. But these folks don’t seem to be wearing rose colored glasses, either, according to the data FedEx Office’s survey gathered as 70 percent of them reported their 2008 profits were negatively affected due to a decline in consumer spending, with nearly two-fifths (39 percent) of that group noting their year-over-year profits dropped by more than 25 percent. And 73 percent of those small businesses polled anticipate flat or falling profits this year, up from 66 percent in 2008.
Yet they remain optimistic – and that bodes well for trucking, I think. Of the 500 business owners surveyed, 45 percent confirmed they would choose to open for business today – even if they had to do it all over again in the current economy. Moreover, the survey showed a greater number of those polled plan to invest in themselves with nearly half (47 percent) planning to increase their marketing and advertising spending this year as a result of the economy, compared to 38 percent who considered the change last year.
While the economic landscape in the U.S. remains far from pretty, there also seems to be growing amounts of confidence just under the surface that things are getting better – if only marginally so. The key to surviving the last mile or two of this downturn may hinge on that confidence, as businesses will need to keep reaching out to customers – especially long-term customers – to make it, noted Professor Jerry Osteryoung with the college of business at Florida State University.
“With the economy still not showing much improvement, it is vital that you focus your attention where you can have the greatest impact on sales,” he explained. “In these economic times, I have seen everything from firms with sales down as much as 70 percent to firms that are still seeing small increases; however, the vast majority is experiencing decreases in sales around 20 to 30 percent this year.”
He stressed that getting new customers is going to be very difficult in these economic times. But by extension, that also means that as most people want less uncertainty in their lives right now, they are by and large less willing to make changes in vendors.
“The low-hanging fruit is your existing customer base,” Osteryoung pointed out. “They already have a relationship with you, and they already trust you. You need to cultivate your existing customer base to the greatest extent possible in order to increase sales or minimize reductions.”
One strategy Osteryoung noted came from a firm his program is working with, where the company had each member of their sales staff call 30 customers a day to thank them for their continual patronage. They also asked each customer if there were any additional ways they could help them; as a result, their sales are up by 10 percent through this effort.
“Redirecting your sales force from going after brand new accounts to existing customers takes some planning and motivation,” he said. “For so many years, sales forces have concentrated in getting new accounts not increasing the sales from existing customers. You now must train your sales staff to go after the existing customer first and new clients second.”
It all gets back to putting those oars back in the water to get going again – and about keeping a more positive mindset, despite the tough times, by viewing the glass as half full to start with.