More lessons from sitting in the hot tub at the Retlaw Hotel in Fond du Lac with a manufacturing guy.
Factories are just trying to get jobs to break even and keep the lights on and their core or essential employees on payroll, he tells me. This appears to be the best strategy for organizations right now.
But now is also the best time to retool, reinvest, and buy. The reasons: 1. All materials are cheap, all the metals are cheap, all the commodities are inexpensive. 2. There's no waiting line. You can get it made now.
The recession will end when everything wears out and business will have to buy new equipment, computers, software and so on.
There will be a rush to purchase goods after the recession ends. So factories will be backed up with orders, prices will rise, business will get their new equipment later than they want or need.
Lesson: Invest now. Whether it is cheaper goods, or the best employees, get them now.
the tricky step is to have the cash to make the investment - or to have the credit. Is this another example of the rich get richer and the poor get poorer? How did this unfold 100 years ago?
Posted by: kassia | May 19, 2009 at 05:24 PM