If you ever wonder what the most important issue is for most Americans, one needs only to remember the immortal words of onetime political strategist, James Carville: "It's the economy, stupid."
Carville plastered that now famous phrase three decades ago — to some of us, that seems like just the other day — in his role as an adviser for campaign workers of then presidential candidate Bill Clinton. The country was in the throes of a recession under President George H.W. Bush, and the Clinton campaign used that phrase successfully to oust the incumbent in the November election.
We are reminded of that as we approach the midterm elections amid an increasing nervous time for businesses, both big and small.
A recent survey conducted by The New York Times and Sienna College revealed that 44% of respondents identified either the economy (jobs, stock market) or inflation (cost of living) as the most important issue facing them today.
One needs only to take a trip to the grocery store to see that firsthand. According to the Consumer Price Index, the cost of food has risen 11.2% over the past 12 months.
Those same statistics show the cost of tires has jumped 12.9% since September of 2021. From August to September 2022, the cost jumped 0.2%, indicating there is no end in sight to skyrocketing costs.
With two quarters of negative economic growth, the housing and construction markets contracting, and energy costs high, it certainly looks and smells like we are in a recession — and if not, well, buckle your seatbelt because the worst is yet to come.
But hold on a second.
In that recession back in 1992, jobs were tougher to find than a wheat penny. Today, that is hardly the case.
Many small businesses, especially in the tire and automotive service industry, are struggling to find qualified employees for open positions. The national unemployment rate sits at 3.5%, near an historic low. In 1992, by contrast, the unemployement rate was around 7.5%
So what does this all mean for you and the success of your business?
If you haven't already done so, start preparing for a worsening economy, particularly beyond the midterms, when the government likely becomes even more divided.
Keep a close eye on expenses, especially inventory. Maintain your financial stability.
Ensure your cash flow is steady. Look for ways to diversify. Add another product or service to your arsenal.
Protect your customer base. Don't give them any reason to shop elsewhere. All tire shops seem to emphasize customer service. Double down on that.
Be flexible. Innovate whenever possible. Continue to show your customers and employees that you offer better products and service than your competitors.
If nothing else take a step back and evaluate what you do and how you do it.
And should someone ask you, "Why, after months of record profits, are you doing this?" Give them a simple answer: It's the economy, stupid.