Developing Your Economic Forecasting Skills
Economist Peter Navarro will help print shops prepare for 2009 at SGS.
If you’re of the glass-is-half-full mindset, you’re probably looking ahead to the economic turnaround that experts such as nationally known economist Peter Navarro are predicting for 2009 and 2010.
But exactly when will the tide begin to turn? What should you be doing now to position your company for the upswing? How can you predict-and prepare for-future swings in the economy?
You can get the answers you need at the Signage and Graphics Summit's newly added general session, 'Managing Through the Downturn: The Perils and Promise of the 2009 Economy,' led by Navarro, an economist and author regularly featured in business media such as CNBC and The Wall Street Journal.
Held on the first day of the event, which takes place January 26-28 at the Rancho Bernardo Inn in San Diego, the session will provide a detailed forecast of the 2009 economy and stock market in 2009. Just as importantly, he'll provide a primer so print shops can develop their own economic forecasting skills, and share proven strategies that executives who are savvy about business cycles have used during recessions to make their companies even stronger.
We caught up with Navarro as he prepared for this year's Signage and Graphics Summit:
The classic response to a business cycle like this is to have the CFO slash every conceivable cost out of the budget to reduce the hit to margins. Is that the right thing to do?
Navarro: I have written extensively about strategies designed to manage around business cycle movements in key turning points like recessions. As a rule, the smartest companies engage in counter-cyclical behavior. Rather than decreased advertising, for example, they increase advertising to build brand and increase market share. Smart companies also use recessions to 'cherry pick' from a deeper talent pool to staff at lower costs. Most companies won't be able to 'crosscut' their way out of this recession.
In your experience, what’s the one tool that most CEOs realize they don’t have, and wish they did, when they face this type of challenge?
Navarro: The ability to have seen it coming. Much of my teaching and public speaking life is dedicated to training corporate executives how to do their own economic forecasting on a daily and weekly basis so they are never caught by surprise by recessionary downturns. The two things that CEOs really need right now is a high level of economic and financial market literacy and large cash reserves. If you find yourself with large inventories and in a cash squeeze, your company simply doesn't know how to manage the business cycle very well. That's a task you need to learn. We’ll be discussing that in San Diego.
We don’t want to steal your thunder and share your predictions for 2009 here-we’ll save that for San Diego. But we’re curious if you have ever seen an economic situation quite like this one in the years you’ve been doing economic forecasts.
Navarro: The current economic situation is both unprecedented and historically significant-as significant as the Great Depression. There are so many variables that no economic forecaster can accurately predict (except by accident) how long the current travails will last. What worries me the most is not the short-term cyclical drop in the economy, which we call 'recession," but rather the possibility of a long-term secular downshifting of the economy due to the loss of our manufacturing base.
The Signage and Graphics Summit, produced by The Big Picture parent company ST Media Group, brings together top-tier executives from high-volume digital-printing, sign, and screen-printing companies to discuss common challenges, learn best practices, and explore new avenues for growth. The conference is a combination of educational seminars, roundtable discussions, networking and social events.
SIGNAGE AND GRAPHICS SUMMIT