May You Live In Interesting Times
30 December 2008 Market conditions make it impossible to predict how prosperous agrochemicals might be in 2009, sources say. And uncertainty breeds more fear and hesitancy in business. But chaos is a part of life, a part of life we need to embrace if we want to persevere in these interesting times. Agrochemical businesses don’t have the luxury to wait-and-see like the growers of the world. They must understand markets so they can move inventory when political and economic opportunities arise. And there are opportunities:
It’s more of an observation than a curse. We do live in interesting times politically, economically, and socially. As I write our annual Outlook 2009 stories for our February issue, I’m overwhelmed with news about geopolitical turmoil and global economic ambiguity.
Protests in Thailand, elections in Bangladesh, and a turning of the tide in Kashmir are just a few of the political stories helping to shape our markets for 2009. Many predict that Thailand and other underdeveloped parts of Asia are the few bright spots in 2009 for the agrochemical industry, and political commotion could turn the tide in either direction. Just look at the price of oil this week after the rash of fighting in Gaza.
Add waffling stock markets and falling commodity prices that have encouraged growers to wait to purchase crop protection products and fertilizers until they can gauge the value of their harvests, and 2009 looks like one of the most uncertain years for the agrochemical business in recent memory.
New governments help fuel this uncertainty in the local marketplaces. Will subsidies still be available for traditional crops? Will new tariffs and taxes affect the market? Will struggling economies affect demand for food?
Market conditions make it impossible to predict how prosperous agrochemicals might be in 2009, sources say. And uncertainty breeds more fear and hesitancy in business. But chaos is a part of life, a part of life we need to embrace if we want to persevere in these interesting times. Agrochemical businesses don’t have the luxury to wait-and-see like the growers of the world. They must understand markets so they can move inventory when political and economic opportunities arise. And there are opportunities:
First, increase your sales budget. Your business thrives on moving inventory, and the changing global dynamics will force you to find new clients to grow as a business. Book extra travel to new markets entrenched in political change, and solidify existing relationships to ensure the revenue will start to stack up later next year, when many economists expect a surge in investor confidence and agrochemical transparency.
Second, cut operations. Not to the bone, but the one lesson that global economists are learning is that when consumers are unsure about the economy, manufacturers must produce less or they will be shackled with expensive inventory. And having your investment idled in a warehouse is a curse from which your business might not recover.
Some businesses won’t survive 2009. What are you doing to make sure you’re not one of them?
Send me your thoughts at [email protected].
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