We ran across an interesting article comparing depressions, not tropical storms or states of mind, but the big economic depression of the 80s and our current economic situation. One point the article makes is that the 80s depression was much worse for small businesses for a variety of reasons. You can read the whole article here.
If you were in business during the previous recession, do you agree with this article? We'd appreciate any comments you might have.
As a consultant that works quite a bit with smaller retailers, I can comment from a retail perspective. For these retailers, who don’t compete on the basis of price as much as they do on quality, service and fashion, the recession began in the spring of 2007, a full nine months before the overall recession began. The drop off in business at that point was pretty dramatic. Many larger mid-tier value retailers, such as Macy’s, Penney’s and Kohls, started to see their sales weaken later in 2007, and then roll over as we got into 2008. Price-driven retailers like WalMart and Costco have actually seen their business grow through this period. We’re starting to see the value mid-tier beginning to show signs of recovery, while the smaller specialists, who are the least value priced, are still struggling. I suspect that small businesses in general, who as a rule can’t compete strictly on price, will experience a slower and later recovery than their larger competitors, as we are seeing in the retail industry.