Tag Archives: Temp

How Are You Responding to Market Instability? Seven Thoughts

Situation: Market swings in recent weeks have shaken up some people. A CEO is curious about how other companies are seeing this as well as how the see their companies doing in the current economy. How are you responding to market instability?

Advice from the CEOs:

  • Business turned back up two years ago, and we are working on major sales opportunities.
    • Actions Taken:
      • We reduced executive expenses.
      • We are sharing a bookkeeper with another business to reduce salaries.
  • In April we increased staff to respond to strong first quarter demand; however since April revenue is flat to declining.
    • Actions Taken:
      • Let a few people go, may have to do more of this.
  • The current economy benefits our industry because our service thrives in an uncertain economy. We have not yet had to make adjustments.
  • We continue to see a big shift from direct hire and full-time to temp and part-time employees – this is working in our favor. Weaker competitors have closed shop.
  • Business is going well. Most customers have cash. The major decision that we face is how much to grow. We’ve seen some project cancellations, but not enough to hurt.
  • What concerns you about the future?
    • Availability of credit lines.
      • Varies by bank and your relationship with the bank.
      • Securing additional or increased lines may be difficult.
      • Anticipating a raise in rates by the Fed, lines may carry a higher interest rate.
    • The trickle-down effect from consumer spending continues to be weak. We are looking for opportunities less sensitive to swings in consumer spending.
    • Receivables are being pushed out.
  • What are you doing about this?
    • Proactively having employee meetings and being straight with employees about how the company is doing.
    • Good opportunities to lean up:
      • Cutting expenses.
      • Cutting less productive employees.