Nobody knows your business — or your expectations — or your situation — as well as you do.
That’s why IB wanted real projections from real executives about where they think this local economy is headed. To assure we got the right information the right way, we partnered with Chamberlain Research Consultants to construct and send our poll to a pre-selected group of 100 companies.
Our second partner on this project is Mike Dubis, President of Michael A. Dubis Financial Planning, LLC and adjunct lecturer at the UW WI School of Business James A. Graaskamp for Real Estate. Dubis is also an IB blogger (see his bio posted with his postings here). He will offer a quarterly analysis of what we are seeing as we continue to poll the same group of IB100 Company executives monthly, which will be printed in IB magazine. (Watch for our November issue with our third-quarter results!)
The IB100 Companies group includes both business-to-business and business-to-consumer entities, as well as a few significant non-profits. We purposefully selected companies across all size ranges and industry sectors.
The first polling was done in June. We have commitments from 100 company executives to participate, but those failing to report in a timely manner will not be counted. However, our response rate was cited by Chamberlain as “Excellent” and our statistics should reliably represent the lot.
We’ll repeat these same questions to our IB100 companies every month, so that we can bring you a consistent rolling index, and together we’ll see how our expectations (and realities) change over the coming months and years. The monthly snapshots will be posted at IBMadison.com under the Companies tab.
Real people, first-source data. You’ll get it first from the IB 100.
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IB Asks:
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Summary: What does it all mean, given our first one-snapshot view? Here’s IB’s take:
- Area businesses definitely feel that overall, Dane County is fairing better than the national economy: 57% thought the U.S. economy was “poor” while only 3% would consider the Dane County economy to be in similar shape.
- Our executives feel that their current personal economic situations are fairing better than the general economic indicators.
- 54% of the businesses reported they felt their company revenues would increase in the next quarter, though only 15% of those same companies said they were going to increase their own spending. Question: Is there a disconnect in understanding our own roles in recovery?
- While more than half the companies are optimistic about the next quarter, 31% are saying they expect to cut more costs, and 15% expect to cut staff. We know where some other cost cuts will occur, and non-profits are not out of the deep woods yet, with 33% of the IB100 Index Companies reporting they intend to decrease their charitable giving.
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Commentary from our participants:
CPA Firm President: “I am worried about the proposed tax increases and the collectibility of bank assets. People want the economy to progress; the government can help by outsourcing the stimulus program.”
CEO, IT Solutions Provider: “We see mixed results; our manufacturing and construction clients are in tough shape, but our professional service clients are doing well and are aggressive with spending/investments.”
Bank President: “Regrettably, it is very likely that some parts of our current economic malaise will exist for some time to come. The changes in our basic business climate are so severe that it is hard to imagine that ‘prosperity’ will come quickly to the many. Cultural changes emanating from our changed political climate will also take time to settle in to a comfort zone. It will be a while before we all learn to live in the new ‘normal’.”
Nonprofit Agency Head: “We depend heavily on government grants and contracts. The outlook is diminished funding in these areas.”
Mid-Sized Retailer: “My biggest concern at the moment is not having a good understanding of consumer spending, in contrast to the past, when sales were more reliable. So much uncertainty on whether people are going to make decisions to buy impacts how we run our business. It causes us to be more cautious on our variable expenses, which trickles down and affects other businesses we work with that provide us services.”
Wealth Management Firm CEO: “Our investment strategy is based on an improving economic outlook. The financial markets are signaling that the worst is over for the economy. I would expect the national economy to slowly improve over the next 6-12 months as the focus of consumers seems to be to deleverage and save more. The economy cannot enjoy any meaningful sustainable growth without the consumer willing to spend.”
Automobile Dealership Owner: “Although I can’t say Madison and Dane County are recession proof, I will say that we seem to weather the storm a little better than most, and history has shown us that on the whole, we seem to rise out of our doldrums a bit quicker than the rest of the country. Keep your fingers crossed we’re actually starting to see an uptick in our business.”
