2009 Economic Outlook for the Small/Mid-Market
5/13/2009 by Jack Burnett
Mark Vitner, Wachovia's Managing Director of their Economics
Dept. spoke recently at an event sponsored by Business Builders in
Atlanta. Mark had a great analogy for our economic
situation. He said,
"We were going around a tight curve and out of control in the
3rd quarter of 2008. During the 4th quarter of 2008 we hit
the railing and flew off the cliff.
During the current quarter we will hit the trees, and in the 2nd
quarter this year we will hit the bottom of the ravine.
Then we will need to call AAA, get a tow truck, and get pulled back
up the mountain."
This analogy paints the picture that it is going to be worse
before it gets better in 2009, and the recovery is going to reach
into 2010. As we talk with our customers and learn more about
their customers, we see shifts in ways companies are
operating. Our observations can provide valuable insight for
the small and mid-market community we serve.
Here are some of those observations:
- Manufacturers associated with traditional, offline marketing
and communication services have been hurt. Billboard
printers, newspapers, envelope manufacturers, etc. are suffering,
for example. Companies are adding B2B and B2C eCommerce,
e-mail campaigns, and web analytics. Web-based marketing
gives you more for your dollar, and produces measurable results as
opposed to the sometimes unclear results from other marketing
efforts.
- We notice that there are not many companies beginning or
starting a large, extended ERP/MRP project. Most companies
have made those investments over the last few years. Now
people are looking how they can leverage that investment by adding
on custom solutions to the core systems that increase
competiveness.
Continual improvement programs following a strategic plan are
more important than ever. Smaller projects with tangible
short term results are in. We think it's time to concentrate
on the shop floor - improving your work processes and visibility of
information across the manufacturing value chain.