Thursday, March 12, 2009

Busted boomers

I couldn't resist that headline! Mish has a very good post on the economic outlook for the Boomers (synopsis: not good). This is something small business people like myself need to carefully consider. We are already seeing some rapid changes in buying patterns in the nursery business at the moment: my own feeling is that the top end of the market is or soon will be toast (Mish's data show the very top end of boomers may still be solvent but we don't see too much of that demographic in Foster).

The USA is six to twelve months ahead of us in my estimation. What we will see is vast numbers of people who formerly considered themselves as middle-class tumbling down the social ladder. They will have frugality forced upon them, so businesses depending on the discretionary dollar from them will be in big trouble (that's us at the nursery to some extent).

We're madly trying to diversify to get the income stream back up (we're starting a mowing and garden maintenance department and have decided to persevere with the florist business because although it's been a loser till now, we think it has legs). The big fires, particularly our local one on Wilsons Promontory, have killed the tourist trade at the moment, but that was on top of a fall-off in sales which was apparent well before Kevin Rudd's handout inflated our Christmas sales to record levels.

We are going into a time of rapid economic change and we're going to have to adapt in a very capital constrained environment. The race will not favour the swift or the clever, but rather those who have little to lose, do not panic easily, have a good network of friends and non-monetary reward systems which keep them happy (it's called family and community, folks!) and are not the kinds of hot-blooded idealists who rush to impale themselves on the horns of political dilemmas which unfortunately will be characteristic of the next phase of our social scene. A clear-eyed view of what's happening, a positive attitude and a willingness to do the work are also necessary.

The boomers are going to be interesting to watch. Will they be bitter? Will they get their jollies from toxic politics? Will they accept the changes and adapt? Will they try and grab the goodies that are left and ignite inter-generational conflict? I suppose we'll see it all.

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