Do you ever have the feeling that some days 99% of the news you get from media is somewhere between negative and bad? Well, I’m a very positive person and sometimes when sitting down to write this blog, I want to push away that bad news feeling. In the present business chaos gripping our country there is opportunity but it will take insightful long term thinking to get to it.
I do business with some of California’s and America’s best known corporate brands and even they are applying the budget brakes. My belief is that with so many things being uncertain from purchasing decisions to presidential politics the natural tendency in business is to say “wait a minute” when it comes to spending money. All that bad news regarding the availability and cost of money, energy costs and a general “attitude of lassitude” is slowing business activity very perceptibly. But it is in exactly these kinds of conditions that the greatest entrepreneurs made some of their sharpest moves. Henry Luce launched Fortune Magazine in February, 1930 just months after the 1929 stock market crash. At a time when other dealmakers were cowering, Luce built the magazine into a cornerstone of his media empire. In today’s world, Sam Zell “the Grave Dancer” is taking a shot at reinventing media at Tribune.
But even in all this murk and sagging spirits, opportunities are sprouting like mushrooms around dying trees. For example, the modern global corporate model is probably breaking down. For decades is has been about making large amounts of product and shipping it over great distances but now high energy costs may be turning that model on its head. Local economies and small to medium size businesses that manufacture or assemble needed items will thrive. Some of the towns and cities that shrank with people fleeing to the suburbs will find a new energy in their central business areas because of increasing energy costs. The trillions of dollars that must be invested in renewing our infrastructure over the next decade will sustain many new businesses.
Major corporations aren’t really disappearing even though a glance at this morning’s paper gave me the impression that companies like Lowe’s and Starbucks could be melting down. However I’m sure that some of their senior executives feel like they are trying to fix an airplane wing while it is in flight. Today I served as the emcee for a lunch event at the California Construction Expo at the Los Angeles Convention Center. Some of California’s largest public agencies and private construction companies were looking for small businesses to supply services or partner with them on various jobs. As the giants employ fewer people, they’ll need a greater variety of independent businesses to help them lower their fixed costs.
I’m convinced that something old is dying to be replaced by something new and that emerging new world has small business development at its center. While driving into Palm Springs California along Palm Canyon Drive last week, I noted many empty stores in the north end of that resort town. Decades ago that street was populated with brand name stores and when they moved out, tee shirt shops and tourist novelty stores replaced them. With this wave of vacancies I’m certain that local entrepreneurs are nurturing ideas that that will fill in many of those blanks and some of them will be with ideas we’ve never heard of. As the giants shrink, people will call upon their most innovative skills to thrive. In my neighborhood, a building that housed a bank three decades ago had become an upscale restaurant, then a Blockbuster video store. As of last month, it’s now a bank again. The road to success is always under construction!
Before he died, Kurt Vonnegut had a great line. He said there should be a Cabinet position called secretary of the future, so we could see where we're going. I don’t pretend to be able to fully predict the future, of course. My mission is to promote the entrepreneurial spirit as a nurturing and healing force in American communities. In that regard there is good news indeed.