THE ROAD TO RECOVERY
These days there is a lot of talk about indicators showing that we’re getting closer to recovery but how does that play out in your business?
{see} Magazine investigates the signs of recovery and helps you sort it all out.
Auto Sales
The "Cash For Clunkers" program turned the ignition on the new car business for the summer but by the end of the summer the engine had still not turned over. While new car sales spiked during the summer, the used auto sector suffered from shrinking inventories.
It appears the entire auto sales sector is not quite out of the funk of recession. With used auto sales being, at least in part, dependent on the new car market, it's hard to imagine things getting better before they get worse. But there is an up side: prices on used autos have gone up as inventories have shrunk. You may have less to sell, but at least you can command a better price for the product.
Property Management
With renters feeling the pinch, many are looking to negotiate with their landlords for cheaper rents or other perks. In some respects the property managers' fortunes will follow the fortunes of the consumers. In other words, when renters get back on their feet, the market will get better and property managers won't have to give so much in the give and take of negotiations. But until the economy really gets revved up, renters will be out of work, stressed about cash flow and coming to you for relief.
Though it is not good for the overall economy, the fallout in homeownership means there are more people in the pool of renters than there were when anybody with a pulse could (and did) buy a home. A flood of broke tenants is not exactly going to cause a windfall in the sector, though, so proceed with caution.
Credit Unions
With all of the turmoil in the economy, credit unions loaned over $144 Billion in the first quarter of 2009 according to a report released by credit union consultants, Callahan & Associates. These loans have included everything from auto lending to credit cards to home equity lines to student lending.
Credit unions have not been completely immune to the recession, but you can make the most of the situation. Those of you in the credit union world should be able to grow your memberships as consumers look for alternative sources of credit.
Retail Business
Regardless of what you're selling, if customers cut back on spending, you'll notice it. That's exactly what happened when the economy took a nosedive. According to a Harris Poll released this summer, four in five Americans say they have made cuts over the past year in their personal spending due to the economy.
The same Harris Poll revealed that 76% of Americans have not increased spending recently, despite signs of an upturn in the economy. Even among people who have increased their spending recently, only 4% have returned to pre-economic collapse spending levels.
There is one bright spot for those of you who sell products primarily to younger people. 18-34 year olds were twice as likely to have returned to their old spending levels.
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