Updated: Oct 7
This blog article and podcast episode are just for California small business owners. If you live another state, you are prohibited to reading or listening to the content. Just kidding!
I was prospecting for insurance clients in Folsom California today. Folsom is about twenty miles northeast of Sacramento.
While sipping coffee, I started a conversation with a woman from Jamaica who worked at a local business. For everyone's information, it is extremely rare to meet someone from Jamaica in Sacramento County. Sacramento is not like Tampa Florida, my home.
Listening to this employee talk about her job, she mentioned that the business owner was not happy about the California economy. The business owner mentioned that if there were an upcoming layoff, the Jamaican woman would be spared and would continue to have a job.
Wait one minute. The business owner mentioned the L word, layoffs.
The California media is reporting there is a shortage of workers and workers are in high demand. Something is definitely not right about what California residents are hearing. If the media are correct, then why is the Folsom business owner using the L word?
As an Economics student and business graduate, there could be only one reason California small business owners have to contemplate laying off workers: revenue is not meeting expectations.
When revenue goals are not being met, and the business continues to stay open and keep staff employed, business owners must be either not taking salaries or they are draining their personal savings to pay business expenses.
At some point, California business owners will decide not to keep their companies afloat using personal incomes and securing business loans.
The other interesting point about this situation is Folsom is a upper middle income community. Folsom businesses include Intel, California Correctional Facility-Folsom, and workers who maintain the huge Folsom Dam which controls water flow from the American River. Sacramento is California's state capital, so there is a large number of state employees in Folsom.
Folsom is the city where many San Francisco Bay Area residents move after selling their Bay Area homes. Lake Tahoe's Heavenly Valley Ski Resort is approximately 70 miles from Folsom. Folsom's crime rate is one of the lowest in California.
Traveling throughout the state for business and to visit my sons in Los Angeles and Silicon Valley, small business owners are having similar revenue challenges as the Folsom company.
On October 3, 2022, gas prices just hit an all-time high of $6.46 per gallon 87 octane. The good news is $6.46 is not adjusted for inflation. Inflation adjusted prices could be close to $10 per gallon! Under President Donald Trump, California gas prices averaged about $3.00 per gallon for 87 octane.
The point of this blog article and podcast episode is to ask the question: who really wants to stay at the top in their business?
Now is not the time to wait for your phones to ring. The phones will not ring as much as they used to 10-20 years ago. Recessions motivate consumers to cutback spending which is probably the reason the Folsom business owner is experiencing revenue shortcomings.
What can small business owners do to maintain revenues at acceptable levels or even increase revenues?
Shaking the trees
Shaking the trees is a sales & marketing idiom to describe business owner deliberate efforts to tell potential customers about a company's products and services. Even in a recession, consumers are still buying products and services...the volume is just less.
Business owners must shake the trees to inform consumers not affected by the recession, who have discretionary income, that companies want the sales. Consumers will respond.
321 Biz Development is ready to support small business owners who need to get the word out about their products and services in a professional way.
Thanks for reading this article and listening to the podcast episode.
Rick Nappier, President
321 Biz Development