If you were looking for a pint-sized nugget of information to help with your understanding of how the economy affects businesses and leaders, your cup runneth over. Attendees walked away with a Santa-sized bag of information from Dr. Mary Kelly’s “Economic Outlook for Today’s Leaders” session on Tuesday.
With wit and humor, Kelly shared an amazing amount of information about the economy, her thoughts about the future and her suggestions for car wash owners to capitalize on and navigate through what’s in store. Kelly stands behind the motto: “Make your decisions based on facts, not fiction.” Which is why every nugget and every slide she shared made even more of an impression.
With lightning speed, Kelly ran through a repertoire that included everything from Millennials (“By 2025, Millennials will be 75% of the workforce.”) to advertising and tariffs. “Can you make a million dollars a few quarters at a time?” she asked. You bet!
Start with a good quality product, pleasant interactions and processes and procedures that are easy. And, as a consumer, she advised: “I need you to tell me if there is something new. I like to try new things.” That info might encourage her (or other consumers) to stop when they wouldn’t have previously.
She went over some of the 2019 trends, such as the economic indicators being positive; unemployment is declining; there will be 20.5 million jobs created by 2020; the workforce participation of older workers will increase, yet the overall labor force growth rate Is declining; and the fastest growth is health care, personal care, social assistance and construction. “The 2019 economy… is pretty okay,” she said.
The “okay” economy affects people and businesses differently, though. For example, the low unemployment rate means it is harder to recruit and retain employees. If you haven’t heard of the “theory of efficiency wages,” it might be something you’ll want to consider. It is giving raises to employees to keep them from leaving. Right now, wages are low and flat, but are expected to increase 3 – 3.5% in 2019. Also, flexibility is important. “Flexibility is why your people stay,” she said.
Disposable income is directly connected to the economy as well. Take the tariff wars going on, for example. “Tariffs affect people’s disposable income,” Kelly said. “Car washes are a luxury item. They can go a long time with dirty cars.” Uncertainty causes a similar response. “Any time there is uncertainty, the market takes the impact,” she said. Plus, money, for a lot of people, is an emotional subject.
The key to weathering it? Make sure you have a vision plan and a business plan in place. “Work through them with your team,” she said, and don’t neglect your M.A.T.H. --. money, alcohol, travel and health.
“It was really good. I came here with an open mind, looking for insight on what consumers are thinking and seeing, and how unemployment trends are affecting business,” said Mark Nuss of Summit Equity Group in Kansas.
“It was very informative. It was my favorite session thus far. She is energetic and interesting,” said Christopher Hoeppner of Brown Bear Car Wash in Washington.