The Economy that wouldn't Die, the Debt Ceiling, and the Summer Selling Season
The Economy That Wouldn’t Die!
Actually, it might, but it’s taking a while.
Typical small business borrowing rates are up from 3.25% to 8.25%.
For every $100,000 borrowed, you are now paying $8,250/year instead of $3,250/year in interest.
Now multiply that by 10 for a million-dollar line of credit, and the difference is $50,000.
That’s the cost of an employee, so in theory, as rates go up and if businesses want to keep their costs the same, something has to give, and the Fed is betting it’s the employees of the borrower.
As people get let go, unemployment goes up, the number of jobs goes down, less money is made, less money is spent, and costs to buy stuff go down. That’s the inflation part.
I’m starting to think that’s more of a hope than a plan, and remember… Hope is not a plan.
So why do I say all of this?
Well, the numbers are out this week, and instead of an expected job growth of 190,000, it actually was 339,000. BOOM!
Yes, unemployment went from 3.5% to 3.7% but…
Number of job openings went from 9.5 million to 10.1 million. They increased!
And the number of new jobs for the previous two months was revised up. Significantly.
So much for theory.
In other big news, like the debt ceiling:
The loan committee has reviewed your request to increase your $31.4 TRILLION line of credit, and it has been approved, subject to the following provisos:
You must pay back $27 billion in unused covid funds. We gave you the money to use for covid issues, so if you haven’t used it by now, you’re just waiting for us to forget about it, so give it back before you put it into a slush fund.
Recipients of student loans have to start paying them back. They had a three-year break which is more than enough.
Instead of imposing a new debt ceiling which is super annoying to everyone, we’re just going to allow you to spend as much as you need until January 2025.
That’s when we will look at your spending habits and income to determine how much and for how long we will increase the next line of credit.
Discretionary spending will be reduced by about $1 Trillion over the next 10 years.
If it’s discretionary, is it really a cut? I will have to check into that.
Military spending will be capped at a 3% increase, but at least it’s increasing. We must at least make it look like we are keeping up with the Chicoms.
If you want food stamps, you’ll need to work 20 hours/week to get them if you are younger than the age of 55. Previously, the age limit was 49.
All 12 appropriations bills must pass by year-end. If they don’t, much of the discretionary spending will be cut to 1% below 2023 levels.
I’m pretty sure they mean fiscal year end; That’s September 30.
By the way, all an appropriations bill is, is a budget. But there are 12 of them for 12 different departments.
Agriculture, Interior, Defense, Transportation, etc.
They each must have a bill (budget) approved each year by September 30.
All of them need to pass, or everyone gets a cut.
It’s the summer selling season!
So, how do you keep your focus on sales when “everyone” is out of the office?
First, you realize that everyone is NOT out of the office. You can still prospect.
Second, utilize the out-of-office email to get additional contacts in the company and then use them – courtesy of Paul Castain.
After all, on the out-of-office notice, they did say to call that person if you needed to reach someone in their absence.
That person may tell you the best way to go about selling your product/service, but the first step is asking.
Third, lean on your business board of directors. Who are they?
They are other business owners, VPs or account officers you hang out with that will help you out, but they have to know what your sweet spot is.
So tell them. And ask them to keep an eye open for it.
Your Business Board of Directors
Alert: this is a plug for my business board of directors, but hey, it’s my Report.
There is a group of us that meets for breakfast, and in addition to just shooting the breeze, we listen to what a specific member is presenting. A few weeks back, we had Melissa Hughes with Cedar House Life Change Center, which resulted in last week’s appeal to my readers to help them out with their fundraising golf tournament.
This group doubles as an external sales team as well as my personal board of directors. Between the eight of us, there are at least 240 years of experience that I benefit from.
In eight different industries. And we meet every week.
This week, it was Geof Kine, a fellow that has owned his own merchant services/point of sale company for over 30 years – West Coast POS
Geof is a restaurant specialist – that is his primary focus. Not hardware stores, not liquor stores, not hotels, but restaurants.
He’s really good at that. That’s why he’s part of the group.
They partner with Shift4 Payment Systems
There were several takeaways from his presentation:
West Coast has a very simple fee structure and one-year contract, making it easy to get out of if necessary. It also keeps West Coast on its toes.
They need to keep their customer happy.
One of their competitors, Toast, a well know merchant services provider for restaurants, is, well, toast. He beats them every day.
As with any business, service is key. You can only do so much remotely. Geof prides himself on being on-site.
He also has some very interesting views on the future of payments and ordering automation in restaurants.
You should call him; he’s a good guy to talk to.
Quote of the Week: The most powerful leadership tool you have is your own personal example.
You have 13 weeks during the Summer Selling Season to out-hustle your competition. If you need help, go to yoursalesplaybook.com and see what Paul Castain can do for you and your team. In the meantime, I’ll put another shrimp on the barbie for you.
