What’s going on in corporate America?

Over the last 120 days I’ve been speaking with business owners about what’s going on in corporate America. The questions we continue to discuss center around the economic climate, recovery or no recovery, inner workings of corporate America and overall gut feeling about the next 24 months. Chewing on all of these conversations, I wanted to expand the dialog to include my industry friends.

As you would expect, I have a theory. I believe that what’s currently happening in corporate America (and what will emerge over the next few years) actually allows for some big opportunities in the promotional products industry. But only a small number of business owners are currently positioned to take advantage of them.

First, a little history. Around this time of year back in 2008, corporations were scrambling to put in place a new initiative: cut costs.

Their strategy was two-fold:

1. Get leaner by eliminating jobs. Get back to being scrappy and resourceful.
2. Put all long-term projects on hold. With limited visibility into the economy, only focus on business strategies that impact sales in the current operating year.

Companies acted quickly to reduce staff levels. As a result, the U.S. unemployment rate soared from 6% to 9% in just six months. And there seems to be no end in sight: as of June 2010 we were still at a sky-high 9.6% unemployment, a slight uptick from May (but thankfully down from January’s astronomical 10.6%).

Right now companies are in a limbo. They’ve reduced their people resources to a conservative level, but with the economy still stagnant, executives are looking for other ways to reduce their operating expenses.

Business leaders and executive teams are racking their brains to answer these questions:

• Where can I make strategic investments to increase sales?
• Where can I reduce expenses to save money?

Our industry has the opportunity to take advantage of the latter by providing business process solutions to reduce our clients’ costs related to the procurement of promotional products.

Historically, corporations have paid little attention to fixing the broken buying process because they have bigger fish to fry. But as the economy continues to worsen, I predict executives will take a closer look at streamlining the process of buying promotional products.

Here’s how you jump on the opportunity:

1. Start reading the financial reports from companies and identify those that are looking to save money on business processes.
2. Don’t lead with promotional products; executives will view this as a “spend money” function.
3. Focus on a process-based solution that you can sell to procurement as an immediate “save money” solution.
4. Be sure you have the technology to back it up.
5. Partner with industry players that have proven success with selling to procurement.

Over the next three years, the majority of all promotional products contracts will be up for grabs. If you have a good partner, you can come out a huge winner (and when I say winner, I’m talking about multi-million dollar contracts).

Every economic downturn has some winners and losers. I hope you’ll be on the winning team.

-JB

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