Restoring confidence

The combination of the Obama/Rudd stimulus packages and the decisions of the G7 finance ministers represents a global commitment to restore market confidence.

Fortunately, there is a huge divide between the reality of the large corporations that are treading water and cutting back staff until next financial year and the small and medium business market that has to hang on to its best team until things pick up.

While consumer confidence has fallen 20 points from February 2008 (115.8 to 94.1 in the first week of February 2009) the overall decline has finished in Australia, although in the US it is still falling as unemployment levels continue to crash.

The Roy Morgan weekly consumer confidence poll points out: “Looking back over the past year, 30% (up 4%) of Australians say that their family is ‘better off financially’ than a year ago compared to 36% (down 1%) that say their family is ‘worse off financially’ than a year ago. The largest contributor to the rise in the weekly Roy Morgan Consumer Confidence Rating is Australians feeling more financially well off than a year ago.

Gary Morgan says: “The weekly Roy Morgan Consumer Confidence Rating has risen slightly for the second-straight week (up 0.7 points to 94.1) as the Rudd Government introduced a second stimulus plan to Parliament, including cash handouts of up to $950 (now revised to $900) for all working Australians earning under $100,000, and the Reserve Bank cutting interest rates by 1% to a 40 year-low of 3.25%.”

This means that SMEs need to take three fundamental steps:

• Undertake a thorough-going clean up of customer contacts and ask them to indicate their requirements for the next financial year. In this way you are encouraging inclusion in business and marketing plans as funds begin to flow both here and overseas.
• Review inventory and production schedules to identify what resources and personnel will be required to take advantage of new customers and market opportunities. A quick and quality response to inquiries will be the key to success.
• Undertake training and development programs that can be shown as costs this year but will pay off as the recovery takes place and everybody has to be on full alert for renewal.

Dr Colin Benjamin is Entrepreneurship and Strategic Thinking Consultant at Marshall Place Associates, which offers a range of strategic thinking tools that open up possibilities for individuals and organisations committed to applying the processes of innovation, creativity and entrepreneurship. Contact: CEO Dr Jane Shelton.