Is there a recession coming? I don’t know. Like all of you, I wish I did.
But I can tell you this: There have been enough ominous signs floating around this year to be worrisome and that’s without adding the uncertainty of trade wars, tariffs and a slow-simmering crisis in the Middle East to the equation. There’s certainly been some upheaval in trucking this year. And it remains to be seen if that’s the proverbial “canary in the coal mine,” or an isolated correction that will not spill over into the larger economy. But, like I said, take as a whole, there is definitely cause for concern out there.
Whether you like it or not, whether or not you think certain people are “rooting” us into a recession for political reasons, the fact is that some degree of cooling off on the economic front is possible in the near future. Assuming the worst, the time to prepare for any potential downturn is now, before the you-know-what hits the fan and it’s way too late.
So what can you do?
Truth be told, if you’re a halfway competent manager or business owner, you probably already know what areas of your business are vulnerable and that you’ve been meaning to get around to addressing for some time now. If only you weren't so busy doing other stuff.
Any disaster management expert will tell you that in the event of major catastrophy, there is almost never a single incident that causes everything to fall apart. What usually happens is a chain-reaction of bad things happening. Taken individually, each one of those incidents can be a manageable event. But when they start piling on top of one another, things can go bad with exponential speed. And that’s what you want to work right now to avoid should this economy plow into an ice berg in the coming months.
Beyond the things you already know you needed to work on, there are some other obvious matters you ought to be looking at now, before it’s too late:
- Fuel – Given everything suddenly going on with Iran – and the fact that large, ocean-going vessels will begin burning low sulfur diesel fuel next year -- you should already be on the phone talking with your fuel vendors to see if you can lock down some lower prices now, before pump prices shoot up like a bottle rocket.
- Spending – We all spend too much. I know I do. And when there’s a lot of money coming in, and you’re blowing and going constantly, it’s natural to indulge here and there and throw money at various problems or issues when they arise. Now it a good time to go over the books and rein that behavior in.
- Old trucks – This is also a good time to think about getting rid of some older, less reliant, less fuel efficient trucks. Maybe you’ve kept them in service because you’ve been so busy. But if there’s a good time to put them up for sale, this is probably it.
- Get paid – It’s always a hassle collecting outstanding payments. And every business deals with accounts where it’s like pulling teeth to get your money. But right now is an excellent time to get any outstanding payments you’re owed in. This move, along with cutting spending and generally tightening up your overall operations, can go a long way toward making sure you have some cash reserves on hand to help weather any coming storm.
- Talk to your people – The threat of a recession should be an all hands on deck moment for your business. Get your people and talk to them about the threat and ask them what areas in their respective departments can be tightened up now. Moreover, have them talk to their people to see if there are additional inefficiencies or operational issues that can be addressed now before everyone is in Panic Mode.
In a best case scenario, there won’t be a recession, or a war, any time soon. But you have nothing to lose by taking some steps now to fine-tune your business and prepare for the worst. Hopefully these storm clouds will pass soon without leaving any major economic upheaval in their wake. And if that’s the case, then you’ll be ready to keep on truckin’ with your company in better shape than it was while the dark clouds were gathering. That certainly wouldn’t be a bad thing.