Partner Article

Business finance growing with technology evolution

Businesses around the world may feel inclined to cut back on growth efforts and concentrate on conserving existing resources until the current economic storm has passed. Sadly, this type of business philosophy, which may seem prudent given its conservative, and therefore “safe”, basis, can actually be a formula for failure. At the very least, it can result in business stagnation, which can lead to business failure because the flat revenues cannot keep pace with rising costs, but also do not allow for additional spending to achieve growth.

The truth of the matter is that it is not only possible to survive a business economic downturn - it is possible to thrive from it. Business owners, financiers, and entrepreneurs merely need to look for the hidden opportunities that exist in times such as these. For this reason, a sound business principle is to always have a financing resource available, such as Privat Credit, to provide an infusion of capital as needed to fund the venture.

A prime example of this philosophy can be taken from the Great Depression. A number of today’s profitable companies and corporations had their genesis during the Great Depression, thanks to the forward thinking of their founders, who had the insight to grasp the situation for its opportunities, rather than shrink to avoid its repercussions.

Some examples of companies that began during the Great Depression include, Fortune Magazine, Revlon Cosmetics and Hewlett-Packard

The era of the Great Depression also saw technological advances that were, to some, considered to be a little too “out there” to be taken seriously. One was the electrical refrigerator, which made it possible to store larger quantities of food without danger of spoilage. Another was the electric radio, which became the focal point of the family home by supplying a means of keeping up with national and world news, while also providing family entertainment. Savvy investors, who saw the future of this technology, invested in the cheap stocks of companies such as Motorola, and the rest (as they say) is history.

As significant as these advances were during the Great Depression, they cannot compare to the technological improvements and investment opportunities that abound today. One of the most basic tenets of macroeconomics is that economic climates run in cycles. Sometimes the duration of the cycles are difficult to ascertain, but the cyclic movement is always present. The key to financial success in business is learning the cyclic signals, watching for opportunities, and capitalizing on them.

This was posted in Bdaily's Members' News section by John .