2009: Has there ever been a more challenging year for business? There can be no doubt that 2009 will be a challenging year for businesses of all sizes and sectors. What began as a credit crunch has grown into a serious global recessionary situation. Fear and uncertainty are driving down demand for goods, which in turn is hurting manufacturers and suppliers, exporters and importers. So what is the outlook for 2009? When will the situation begin to turn around? What short- and long-term plans can we implement this year to ensure businesses survive this temporary downturn and get on the road to recovery? MB asked a number of industry leaders and local politicians for their observations of the current business climate and their predictions for the future. Their comments make for some interesting reading, occasionally controversial, and at the same time, refreshingly encouraging.
The coming year has evolved as one that will challenge us to rethink how we do business.
However, history has shown there will always be upswings and downturns in the economy. The real challenge is to look for opportunity regardless of the environment around us – to use creativity and innovation to drive quality, and to capture unforeseen efficiencies. In my 2007 inaugural address I committed to initiating such a process for Markham. Fortunately, we began this process early in the year and accelerated our work as the economy signalled difficult times ahead. We engaged employees in all lines of business in a program called E3 – Excellence through Efficiency and Effectiveness. And, our efforts brought rewards. In less than 10 months we captured $4.5 million in expenditure reductions and developed a 2009 budget which proposes a zero increase in Markham’s net taxes. More importantly, we did this without reducing services. However, our focus on innovation, creativity and quality has not ended. It’s now an inherent part of Markham’s everyday culture. I’m proud of the efforts of our Council and staff to make E3 a success – for seeing the opportunity, rising to the challenge, and setting a course for long term, sustainable change.
Town of Markham
As an Employment Law firm, our degree of ‘busyness’ is a good indicator of the state of our economy. Generally speaking, in a thriving economy Employment Law issues tend not to arise in great proportion. November and December 2008 have been our most demanding months in dealing with Employment Law issues, specifically terminations and pay reductions. At a conference I attended last October, Justice Binnie of the Supreme Court of Canada acknowledged that we are living in critical times. The Courts have appeared to acknowledge this in their decisions by providing employers with greater latitude to make changes - requiring employees to continue to work for the purpose of mitigating their damages to lessen the loss, unless doing so would be intolerable. We believe this will assist employers in making pay reductions and lessen the number of expected terminations. While we agree that we are living in critical times, we believe this will require greater efforts to be made by both employers and employees in dealing with workplace issues to ensure the greater lifespan of companies and employees.
Ronald S. Minken, B.A.(Hon.), LL.B.
Employment Lawyers
Minken & Associates Professional Corporation
We are moving forward! The Markham Stouffville Hospital Foundation is preparing for the largest campaign in our Hospital’s history. Together with our community, we must raise $50 million to continue providing every resident with the services and programs they need, close to home, and to ensure better health today for a stronger community tomorrow.
Suzette Strong,
MSH Foundation
While we all recognize the challenges businesses are facing in 2009, where there are challenges there are always opportunities. Have a positive attitude. Recognize this is a global issue and accept it. 2009 is in fact the best year for development, an important year to re-evaluate, re-focus and revitalize ourselves to develop for the future. 2009 and beyond are filled with opportunities.
Daisy Wai,
President, Ad2000
We have experienced several recessions since World War II, and while unpleasant, they are a normal part of the economic landscape. Stock markets typically peak well in advance of the slowdown, and bottom out while we are still in the throes of the recession. There is no reason to think it will be any different this time. The near term continues to be murky. The effects of the credit crisis will be felt for some time.
Times such as these call for caution, but sitting on the sidelines is not in the best interest of long-term investment returns. The low interest rates and the bottoming out of the market represent great opportunities. The introduction of the Tax Free Saving Accounts creates other possibilities. These challenges and opportunities make professional advice in financial planning ever more important.
Joe A Salib, CFP
Sun Life Financial Investments and Insurance
Because of the economic downturn, this year will be challenging for businesses in every sector, as well as for families and communities. People who see the ‘glass half full’, though, look for opportunities to make things better in every situation. The businesses that will thrive in 2009 will be those which make a special effort to reduce prices and give their customers greater value. How we act during tough times shows our ‘character values’. Helping people during tough times helps to build trust and relationships which will carry on into better times in 2010 and 2011 as the economy hopefully improves.
Eric C. Tappenden
Owner, Chapel Ridge Funeral Home
& Former Chair, Markham Board of Trade
Optimism about 2009 is difficult to find. Unemployment levels are high, and rising bank restrictions are shutting down opportunities. Lower business revenues are requiring businesses to rethink their expenditures and business plans. Underlying the concerns for 2009 is the fear that the recession will persist further into the future. Unless the stimulus in the USA turns the economy around, we could face even more serious challenges.
There is no better time to think through your business. Do a SWOT exercise: evaluate your strengths, weaknesses, opportunities and threats, and develop a realistic plan for the future based on the best information you can find.
Setting realistic, achievable goals for your business in this climate will not create optimism as we used to know it. But you will lay the groundwork for future successes, and not be caught off-guard by any surprises.
Don Cousens
Counsel Public Affairs Inc.
The cautious decision-making and weakened economic factors influencing our commercial real estate situation in Markham are happening concurrently worldwide. However, a number of our basic real estate economic fundamentals have not yet changed from global stock market declines. Yes, jobs are being lost, house sales are down and people are postponing major purchases. There will be ‘rightsizing’ and minor pricing changes, but what we are doing today is simply being economic with our confidence – and that suppresses transaction activity for the short term. Capital for real estate projects is still abundant, but not easily accessible or approved at the moment. Everyone is waiting to see how the economy reacts and the economy is waiting to see how everyone acts, so expect to see an extended ‘wait and see’ period of limited activity for possibly as long as the next 12 to 18 months.
In commercial real estate, there are opportunities in any market cycle. To succeed over the next year or two will demand innovative approaches to traditional issues. Creative financing, vendor take-back mortgages, joint ventures, syndications and realistic land values can all contribute to renewed activity.
We need confidence in our markets and in our country, and we need more global awareness of our undervalued real estate assets when compared to values in other countries. We need confidence that our financial principals are and will remain sound, and that governments will respond appropriately so that, as Canadians, we can get back to an economic standard that works for us all.
Glenn Crosby
Vice President, Broker, Land & Facilities Group
DTZ Barnicke Limited
As I look to 2009, it is quite obvious to me that the average consumer is keeping their financial affairs top of mind in an attempt to conserve wherever and whenever possible. Disposable income is a rarity and those who actually may have some are holding it very near and dear to their bank accounts.
Consumers are more confident and demanding about how they live their lives and spend their money. They are seeking out products and services that give them exactly what they want, when they want it, especially as their budgets tighten.
Consumers are looking for ways to stretch their pennies further. They are dining, relaxing and entertaining at home more than ever before. Cooking from scratch has made a comeback and our industry has to be ready for it.
In order to remain successful, it will take a conscious effort towards excellence of execution in your particular field. The mediocre may not survive. Understanding the consumer and being prepared to genuinely provide them with value for the dollar is a key fundamental to success.
Staying honest to your business’ core values, keeping the consumer (our bread and butter) first in mind is a must at this point in our society.
Vince Tortorici
Manager, Longo’s Box Grove
2009 is poised to be a memorable year and it will not be without its challenges. The economy will dominate our thoughts and will inform our every action as we move through 2009. York Region continues to grow and expand and infrastructure investment will continue to be important for our region. Investment in infrastructure will be a significant tool in the fight to ready the economy: creating jobs while making improvements to our roads and bridges, expanding public transit, bettering our communities. The environment will continue to play a critical role in 2009 and our investment in green technology and industry will be a solid basis on which to build a stronger economy.
Dr. Helena Jaczek, MPP,
Oak Ridges–Markham
Business success in 2009 will depend on the strong relationships built through Chamber of Commerce networking. This is also the year when the savings offered by Chamber of Commerce benefits will really help businesses to stay competitive.
Leslie Walker,
CEO, Richmond Hill Chamber of Commerce
Admittedly, some businesses will be damaged by the current economic climate, and unfortunately some will fail. But many more will survive and prosper. This is not the time for companies to hibernate and wait it out. This is the time for aggressive marketing. Yes, it is the time to control costs and overheads and cut them where necessary, but it is also the time to get out there and market ourselves more aggressively than ever. The business world has not ground to a halt. It may have slowed, but there are still plenty of opportunities out there, and the Markham and Richmond Hill business community is particularly well positioned to achieve ongoing success and growth. We have a wide variety of businesses in highly diverse sectors and we have a dynamic, determined workforce. We must refuse to be disheartened by this recession. We’ve been through it before and lived to prosper. We’ll do it again!
Don Flynn,
Publisher, MB Magazine
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