A Guide to Understanding Tough Times in the Gift, Home Decor, Personal Care and Floral Industry (Second Installment)

Your customers' shelves are full, no one needs what you have to offer and your best account just folded a week ago. It may not be the time to make any aggressive moves in this business, but it certainly is not the time to close up shop either. Here are a few things that you should know before you decide to or not to throw in the towel:

1. Retail customers have little disposable income at the moment
This does not mean that they have NO disposable income at the moment. And this certainly does not mean that they will not have more in the future. Mom is not going to get nothing for this mother's day, she just might not get as big a gift as last year.

2. Inventory levels are very high, few customers need new product
This does not mean that ALL customers need NO product. Something is still going out their doors or it's all over for them and they walk away and call it a day. Those customers who have been through tough economic times before can still come out on top and when they do, you need to be there for them with what you have to offer.

3. Many customers still owe invoices from earlier this year or 2007
No sense in placing your product in a customer's store who can ill-afford to take on another invoice especially from your company. Even if you are offering generous terms, you can eventually kill your customer with kindness. Keep your finger on the pulse of your steady and best customers, but be sure they can still afford to pay you after the sale is complete. For everyone else with a shady payment past- no dice.

4. Your problem may be your product
All product in this industry is subject to economic tides. The time has never been better to evaluate what you are selling and to whom. It may sound obvious, but if your sales are extremely low now, there is little reason to believe that they will become a windfall when times get better. This is a great time to take stock in what you are selling and how in expand or improve upon your product once customers start looking for new ideas. If your sales are slow but still painfully coming through, join the club, hold on and be mindful more than ever of your expenses.

Not that these are novel or somehow divinely inspired revelations as to why you are or are not in this industry or why you are or are not doing well. Far from it. These are simply some insights as to why revenue may be so difficult to obtain in the foreseeable future. These are just reminders to keep in the fore to plan your next move. In the meantime, Beacon Consultants offers low-cost options to keep potential customers informed of your product lineup. So regardless of the economic cycle and regardless of where you see your business in the next six to twelve months, we are ready to help you get through these times.

A Guide to Understanding Tough Times in the Gift, Home Decor, Personal Care and Floral Industry

Gas prices through the roof, credit market through the basement, banks closing, houses auctioned, debt piling up, dollar value falling, inflation rising, food prices unstable.....not the type of environment that makes the average American want to buy what you have to offer.



Let's face it, no matter where you go, money is tight these days and everyone is feeling the crunch. Small business owners have been especially hit hard by the lack of discretionary income available to most people so enjoyed in years past.



This is no time for looking into daring new territory, nor is it a time for major new forays into new products, advertising, promotions or warehouse and office expansion. Most manufacturers see it as a time to hold on and hold tight. 2008 will be the year of caution, conservative inventory levels, low sales volume and tight cash flow. Pay the bank, shut up and take it like a professional, right? After all, we are all helpless to the ebb and flow of economic cycles and no matter who we blame, business, lawyers, government, homeowners, rich, poor, black, white, Hispanic, we are where we are and nothing can change that, at least not at this moment.



But in the same fashion, this is no time to lose focus on what lies ahead and prepare for it. A time is coming, inevitably, when money will be plentiful to the consumer, your product will be the a sizzling hot commodity for a time and you will have a very short time frame to capitalize on the opportunity that a good economic cycle provides.



So what do you do today, when the storms of recession are overhead and no break is in sight?



Just like the weather, you look at the indicators and make your plans based on the best judgement that you have today. You don't plan for a picnic when thunderstorms are forecast for the next three days and you try not to plan to spend the day indoors when the sun in shining and temperatures are optimal. So this is a great time to plan for the next sunny day. What will you do and how? What will the consumer need and when will they need it?

It's easy to get caught up in the horror of big banks, big business and big money vanishing into thin air. The once mighty giants of the industry have fallen and one can't help to wonder if your business might be next, but does it really have to be that way?

At Beacon Consultants, our answer is simply, no.

Next: A Guide to Understanding Tough Times in the Gift, Home Decor, Personal Care and Floral Industry, Part 2