Recession

So it’s official – Australia is in recession. Our first recession since 1991 and that means a significant percentage of the population haven’t lived through a recession and a big percentage of business owners have never navigated a business through a recession.

 

I vividly recall signing a contract to purchase a commercial property in 1989 and watching interest rates soar every day as the settlement date approached. Variable rates rapidly climbed through 15% to 17% with ominous momentum creating enormous panic for housing and business borrowers. In desperation I accepted a fixed 5 year rate of almost 21% through the 1991 recession, which proved to be a very expensive decision because variable rates never reached 20%.

 

We all make mistakes in business and that was one of many I have made over the years. Here’s some of the things that I have learned over my years in business that might help you through this recession:

– Many sectors will not be significantly impacted by the recession

– Many businesses in sectors that are adversely impacted will thrive because:

– Some of their competitors will disappear

– They will be motivated to try new things and some of these will be successful

– There is always enough customers for your business; you just need to make sure they are dealing with you rather than your competitors

 

Ultimately, recessions are about collective lack of confidence in the future and success in a recession is about confidence in your own ability. If interest rates stay under 3% a 2020 recession might be better than a 1980’s boom.

 

Contact


Unicorn Business Solutions are based in Devonport Tasmania, with clients around Australia.

Devonport: (03) 6423 2695
Devonport : 188-190 Tarleton Street East Devonport Mail : PO Box 511 Devonport TAS 7310 Australia