Search Results
July 31, 2009
By: CartPro
Category: Business Tips, Future Trends, economy
The heart monitor on the economy has started beeping again, apparently shocked into recovery by the dual application of bailout money and stimulus funds. Of course, there’s still concern that the cure may prolong the patient’s recovery but the big guy does seem to be on the mend. Many economic analysts are now predicting that true recovery from the recession may begin as early as next quarter, that’s six months to a year ahead of previous predictions. Naturally, there’s disagreement about the strength and speed of the economy’s recovery. “The question is whether we are transitioning to a solid growth period or to something flatter,” explained Dr. Chris Kuehl, economic analyst for the Fabricators & Manufacturers Association International (FMA), in the FMA economic newsletter Fabrinomics.
Kuehl pegs the strength of the economy’s recovery to three emerging trends that manufacturers and businessmen will need to factor into their plans as they position themselves to compete in the post-recession market:
- Cautious consumers. High unemployment and the continuing threat of job loss has made consumers wary of spending and further depleting any financial reserves they have left. Most economists expect consumer spending to lag other signs of recovery, further slowing the recovery process. Until unemployment rates return to post-crisis norms and consumers regain confidence in the economy, demand for goods and services is expected to remain low.
- Consolidation. Financial chaos has forced mergers and acquisitions in the U.S. and around the world, and not just in the automotive industry, Kuehl points out. Manufacturing bases have gone global, shifting from the U.S. and Europe to Asia, particularly China, and Latin America. Digging a toehold into these markets will be essential — and extremely challenging — if manufacturers, especially smaller players, are to survive. The complexities of global business may encourage even more consolidation as small manufacturers partner with larger ones or form cooperatives to gain global access.
- Unsettled financial markets. While banks and financial entities took the brunt of the first blow, they haven’t carried the burden of the economic crisis. Even so, they are still recovering which will continue to make them wary of lending money. The yet-to-be-known impact of new government oversight and regulation will also be a factor. Kuehl sees a return of the “old-school banker” with tougher credit standards, demands for greater cash flow, and less money available for growth and expansion.
Comment (1)
April 01, 2009
By: CartPro
Category: Material Handling, economy
Despite the fact that America’s small businesses have created nearly 70% of the new jobs in the past decade, small businesses have been largely ignored in Washington’s bailout frenzy — until now. Finally, small businesses are about to get a much-needed shot in the arm. As part of the federal government’s plan to jump-start the economy, President Obama recently announced plans to give lenders $15 billion to free up resources for small business loans through the American Recovery and Reinvestment Act of 2009, popularly referred to as the Recovery Act. The plan would also cut loan fees and increase the share of Small Business Administration (SBA) loans guaranteed by the federal government.
While the media spotlight has been focused on the rescue of big financial and automotive corporations, small businesses have been struggling to weather the same difficult storm. Decreases in consumer spending and the general unavailability of credit have hurt small business owners in material handling, manufacturing and nearly every sector of the economy. With the banks keeping a tight grip on money to shore up their own bottom lines, credit-worthy small businesses have been denied the loan money they need to survive, much less thrive.
By funneling federal dollars into banks that lend to small businesses the Obama administration hopes to increase their financial stability and encourage these banks to start lending again. New loans could not only help small businesses better meet current obligations but also allow them to take advantage of merger or expansion opportunities that present themselves. Small businesses are defined by the feds as businesses with fewer than 500 employees. By working through existing financial channels, economic experts say new loan money will be able to reach small businesses faster.
“American small businesses are one of the strongest engines for economic prosperity in the world, and we can’t let this crisis continue to undermine their growth and potential, said acting SBA director Darryl Hairston in a statement released to the media and widely reported.
The Recovery Act will temporarily rescind the SBA loan origination fee which can be as great as 3.75% of the loan. It will also increase the federal guarantee from 85% to 90% of the loan amount. For complete information on the Recovery Act and its impact on small businesses, visit the SBA website.
No Comments →
January 09, 2009
By: CartPro
Category: Future Trends, Manufacturing Industry, Material Handling, OSHA, Safety and Ergonomics, Warehousing, logistics
“The deepening recession creates the opportunity for federal intervention and government experimentation on a scale unseen since the New Deal,” wrote Charles Krauthammer in a column for the Washington Post Writers Group that was widely published last month. Krauthammer is one of many Beltway watchers who have been predicting “a domestic transformation as grand as Franklin D. Roosevelt’s” once President-elect Obama takes the oath of office barely a week and a half from now. Krauthammer believes that Obama’s statement, “This painful crisis also provides us with an opportunity to transform our economy to improve the lives of ordinary people,” presages what will become the key thrust of the new president’s administration: the transformation of America from the ground up.
It’s hard to argue with Krauthammer’s view, particularly given the details about the President-elect’s economic stimulus plan and jobs initiative that are beginning to trickle into the press. As Krauthammer points out, the current situation is a community organizer’s dream and that’s always been Obama’s self view. He sees himself as a world changer but it’s his own world he most wants to change. He’s got Hillary Clinton and Robert Gates on board to keep the dogs of war at bay so he can focus his energies on rebuilding America.
The economic meltdown and jobs crisis have given Obama the public mandate to foment massive changes in governmental policy. People are clamoring for help and looking to Obama to provide it. A definitive win in November and the healthy Democratic majorities that rode into the House and Senate on Obama’s coattails gave him the political mandate and clout to drive new policies through Congress. The massive bailout funds already approved, with another huge chunk of money on the way, put at Obama’s disposal what Krauthammer calls “the greatest pot of money in galactic history.” Combined, current social, economic and political forces would seem to give Obama almost unlimited power to effect change.
That change is certain to increase regulation, government oversight and red tape. Bush administration regulations that critics say weakened the EPA and OSHA at the expense of environmental responsibility and worker safety are expected to be rescinded by Obama’s team in favor of measures that place the burden of responsibility and expense of accountability back on the doorsteps of manufacturers and American business owners.
Next time: Rolling with the punches; taking a proactive approach to coming change.
No Comments →
Welcome to DJ products, Inc. blog. 
