What’s Ahead for 2010?
Because we serve small businesses when they most need working capital, other business and financial professionals frequently call us to ask what is happening with the economy.
We are not economists, not accountants and not futurists. We are more accurately compared to a barometer. We know when the pressure is rising. In 2009 there was a confluence of decreased capital along with decreased demand.
Usually, when there is a tightening of credit or capital there will be an increased demand for our funding to meet working capital needs. In general, this was not true in 2009 because simultaneous with the freeze in the capital markets, there was a sudden drop in demand.
Our seasoned and stable clients were able to weather the storm because they were not heavily laden with long term debt. They used our services to meet payroll and fill existing orders. Then, the “great wait and see” began.
There was a collective “breath-holding” among the major large companies who use the goods and services of our clients.
Well, we now think there has been a collective sigh. It is not a strong wind but a noticeable sigh. It seems like our clients are experiencing an up tick in demand for their goods and services.
I know this is not scientific evidence of a turn in the economy. It is simply the result of over 20 years of watching from the ground level how our economy actually works. So, be encouraged.
