Be Ready When Recovery Arrives
September 4th, 2009
Dennis Laundy business advisory director at Adelaide firm William Buck says businesses need to be ready to ramp up production when the economic recovery takes off and recent indications suggests it is not too far away. Laundy says the upswing, when it arrives, is likely to happen very quickly.
Consumer optimism is rising, and Laundy says sentiment has a huge impact on business activity. “Once that sentiment gets a bit of a head of steam up, it really starts to change the way people think about things. They stop thinking doom and gloom and maybe things are going to improve a bit and start to turn around.”
Laundy says managers may have to reacquaint themselves with old suppliers and, if necessary, establish new relationships, and a final word of caution – borrow appropriately as interest rates look set to rise after being cut to multi-decade lows earlier this year. Don’t use short-term overdraft finance for long-term assets because you are paying through the nose.
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