No doubt, we’re living in volatile times. With daily headlines about Turkey, Syria and China – and the cloud of impeachment hanging over everything – it’s hard for business leaders to feel confident about capital expenditures, expansion, hiring and taking risks.
No one knows exactly where the economy is headed right now. The stock market is still in a similar place to where it was in July and consumer confidence is high, yet every day there is a change in policy from Washington. President Trump tweeted an announcement of “phase one” of a potential trade deal with China (whatever that means), and it’s good news that the U.S. and China are talking – but right now, it’s a matter of who blinks first. Nobody’s winning, and many businesses and individuals in states driven by manufacturing and agriculture are feeling the pain of the trade war.
Given all that’s going on, the International Monetary Fund is predicting that U.S. growth will slow to 2.1% in 2020. That still makes the U.S. one of the few countries that can expect a better outlook.
So what can business leaders do to steer the ship in waters like this? I see a big opportunity right now for middle-market companies to think entrepreneurially and look for new ways to strengthen their businesses. Even when there’s uncertainty or the economy cycles into a slowdown, there are always businesses that do very well, like Amazon, Domino’s, Lego and Netflix. Their leaders plan ahead and, when conditions change, react quickly.
There are many questions we recommend our clients think about right now. They start with whether you have the right overall strategy for the next six to 12 months. If your Plan A doesn’t work out, do you have a Plan B, C or D?
There is still plenty of room for growth in many industries. Where can you find new opportunities? How can you give yourself a competitive advantage over everyone else? What new products and services can you introduce – and where should you scale back? What kind of talent do you need on your team to continue to grow, no matter what the economy brings? Where are opportunities to reduce waste to free up the cash you need to reinvest in your business?
Uncertainty affects all companies – private and public, middle-market and multinational – as well as the investing public. Stability in Washington would help the situation, but we can’t count on that anytime soon. If the Republicans retain the White House in 2020, we can expect more of the same from our Tweeter-in-Chief. And if Democrats take it back, we can count on a transition like we’ve never seen before, which will shake things up, at least for a while.
What we can control is our own mindset. How the economy affects our businesses is driven not just by market forces but also by our attitudes and wherewithal as leaders. One person’s downturn is another’s opportunity to gain market share.
It’s easy to take a “wait and see” attitude in a chaotic environment. In reality, “wait and see” usually translates to “wait and worry.” To me, the future looks a lot more exciting when you look ahead to what’s coming down the pike and find new ways to get in front of it. Many middle-market companies are in an excellent position to grow in the next few years, but when times are unpredictable, we all have to up our game.
October 15, the final tax deadline for individuals to have filed their 2018 personal tax returns, has come and gone. This year, perhaps unlike any other in recent memory, posed many challenges due to the new tax laws enacted in 2017. Our tax professionals at Marcum faced dealing with the complexities of the new law while much of it is still subject to interpretation and debate, with little to no guidance from the understaffed and overworked Internal Revenue Service.
To all of you on the Marcum team that did what you had to do to not only meet but also exceed our client’s expectations, a big thank you from me to you. I’m proud to lead such a dedicated, hard-working team.