Will interest rates go up? – No time is a good time!


If the last 8 years has taught us anything, it should have been that we should not wait until conditions change one way or another before we move to get our businesses on track.

From what we have observed, many if not most of the businesses in this country have reluctantly reduced their profit margins to hang on to market share in the face of currency movements, declining consumer demand and new competitors. The long-term outcome of this is that many businesses are selling products and services, paying wages and generally getting along, but not actually making any money.

Just ask our nation’s treasury about this situation?? If businesses aren’t making profits and paying the required tax to run the country, then let’s start talking about moving away from taxing profits and now tax consumption … yes, it’s the dreaded GST discussion. Defeatist maybe, however, this is now a real conversation.

Given all of the above, what will happen to these struggling/marginal businesses if interest rates actually begin to climb? In the last few days the employment rate has increased, which put pay to any new cuts in interest rates from the RBA. The never ending growth from China appears to have plateaued for the time being at least, and the talk of interest rate rises in the USA are real.

I know we are busy being busy, and we are probably worn out surviving, however if we don’t get moving many marginal businesses will be unable to stop tipping over the edge should interest rates begin to climb.

So let’s take a breath and begin working on the business not in it (as much!) and seek some assistance in areas such as:-

  • Building your organic business – it’s easier to sell more to the people that already like you.
  • Focus on new targets and product development.
  • Engage someone to finally get your business selling online.
  • Remove inefficiency so you can restore some of that lost profit that belongs in your bank account.

So “when will I get time to do this?” you ask– If I reflect on the businesses I have come across in the last twelve months they would all argue they were really “flat out”, however they almost completely say in unison, “I wish I had focused on this twelve months ago”.

So this is a call to action:- No time is a good time to begin this process, all businesses in whatever point of the cycle they are in must begin to future proof.