Business Cycles and their Roots
BriefLetter - Issue 17/2004

Why are many businesses doing so well, while the competition, often even the whole branch, is complaining?

Actually, why do many people point immediately to unsatisfactory data from branches and markets instead of asking why there are such unequal economical circumstances?

Generally it can be said that the famous economic cycle and the formerly customary economic cycles of the branches no longer exist. Today, company economic cycles rule the market. This is why we would like to take a look at the subject of company business cycles and their causes.

There is hardly a branch where no single companies report successes, despite negative national and international trends. BMW in the automotive branch, Burberry in fashion, Chanel in the fragrance market, Tod’s in the shoe market, Illy in the coffee market. The list could be extended by several more examples without difficulty.

In the automotive branch, they are complaining that customers first buy the rebate and then the car. The fashion industry has been reducing jobs globally for years now and is trying to salvage whatever possible through low-budget production in China, Vietnam and Bangladesh. In the fragrance market, 99 of 100 new introductions fail. The shoe trade and the shoe industry suffer from a chronic lack of creativity and are surprised that the customers don’t buy. And in the coffee market, where prices haven’t been this low in thirty years, the coffee business from Triest, Illy, is expanding and showing two-digit rates of growth.

If you look behind the scenes of a business that is enjoying its company economic cycle, you can find out in unison that:

• they are not the largest businesses in their respective branches, but those who are residing in midfield,
• they are headed by a strong business personality, entrepreneurs and/or intrapreneurs, they manage little but lead clearly,
• they possess brilliant Human Relations and Human Resources.
• the businesses possess clear strategies, products with profile and clear-cut cost/performance ratios,
• they attend to carefully chosen and nurtured customer relations, that not everyone who could pay his bill also could be a customer,
• they employ brands, which truly are brands, as to carry the relationship between their products and their customers,

True, there are predominantly traditional values which were unearthed during this analysis of these successful company business cycles. However, they are also the values which we deem essential in our consultancy strategies and apply accordingly accentuate.

It is not the mistakes or weaknesses of other businesses that make a business successful in the market, but rather its own strengths and principles. The economy, the global economy, the regional and national economies and the branches once again need a value and performance system which can be built on, just as much as lower costs, maybe even more than that. The costs are not the biggest problem, but the extensive loss of reliability, truthfulness and discipline. Businesses which possess these attributes, never lost them, are those businesses who the world admires thanks to their success.

 
SchmidPreissler SchmidPreissler Strategy Consultants


Specialized in consumer goods related industries, trade and investments.

Independent and personal.

Creative and innovative strategies through intellectual approach: For excellent business results.

Brand equity enforcement and performance, corporate and product brand strategies.

Proven Business Tools:

The Waisted Rectangle©,
the new perception of the consumer market for demand and supply

The 7-Elements-Definition©
of a brand

The ”Enlightened” Consumer©
as target group

The BrandEquity + Performance Program©

The Holistic Corporate Communication Concept©

Special consultancy subjects:

Creating strategic alliances
brand diffusion
joint ventures
mergers & acqusitions

The Waisted Rectangle©

more....

Editor: Dipl. Soz. Maximiliana Schürrle
Assistant Editor: Regina Seago

SchmidPreissler International Strategy Consultants GmbH
The Lion's House
Burgstallerstr. 6
D 83703 Gmund am Tegernsee