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Qualifying events
Being prepared is a key to long-term success.
By Dustin S. Klein
Smart Business Cleveland | February 2001
I was eating lunch with the panelists of this month's eBusiness Today series when the Fed suddenly decided to cut interest rates by a half-percentage point.
At the time, we were discussing the difficult task of financing an e-business initiative and how the fluctuating economy wasn't helping business owners find the money they need.
That's when Steve Lefkowitz, CFO of e-debt.com, caught a glimpse of the TV screen out of the corner of his eye and saw the breaking news about the Fed's decision. Our conversation came screeching to a halt. With our eyes glued to the video screen, we watched the stock market chart explode.
In less than 10 minutes, the Dow rose more than 200 points, the NASDAQ, nearly 100. The two indexes ended the day up 299 and 325, respectively.
The cut caught investors -- and business owners --completely off-guard. But it proved a vital principle in the business world: Always be ready for the unexpected.
From a financial perspective, that could be when a customer suddenly goes out of business and leaves you holding a several thousand dollar collectible on your books. It could be a fluctuation in the interest rates affecting your ability to borrow money, changing your monthly payments or annual interest.
The unexpected hits business owners every day --federal legislation, health care costs, personnel moves, local zoning laws and initiatives by competitors. To survive and thrive, it's important to not get caught with your proverbial pants down when those surprises hit.
Be willing to adapt
As happy as you are with your current service providers, don't be fooled into believing you'll definitely be with them 10 years from now. When there's a sudden rise in your company's health care costs, be willing to go back and renegotiate with your provider, or, if it refuses, let it know you're going to seek quotes from competitors.
If you are involved in a long-term relationship with your provider, odds are it'll be willing to work with you to keep your business.
Keep an eye on competitors
If your competition is expanding in the marketplace, there is a good chance it may pursue your top sales staff. After all, who knows the prospects better than your successful sales team?
Be ready to ante up to retain your best and brightest. Your competition will.
Read, read, read
The best way to stay abreast of what could happen is to read every publication you can. Last month, SBN Magazine reporter Morgan Lewis warned readers to expect competitors of OfficeMax to follow the Shaker Heights-based office supply retailer's lead and close a substantial number of locations in order to boost revenue.
Five days after the January issue of SBN hit the streets, Lewis' prognostication came true. Office Depot announced it was closing 10 superstores in Northeast Ohio as part of a companywide reorganization that will affect 70 stores nationwide and eliminate 1,520 jobs.
Remember, it only takes one event to set business scrambling. The big question is, are you prepared? Dustin Klein (dsklein@sbnnet.com) is editor of SBN Magazine.
