Prepare for the unexpected – talkbusiness.net

by Mark Zweig (mzw[email protected]) 27 views 
Across America, but particularly in Northwest Arkansas, we are in an unprecedented boom period of growth and expansion. Everything looks good.
The Northwest Arkansas metro unemployment rate is only 1.5%. That’s crazy. Houses sell for record prices and get multiple offers within a day or two of going on the market. Car dealers don’t have cars. We bought a new car recently, and the dealer only had two new cars on their lot. It’s crazy. It seems like everyone is making money right now. It’s almost like the California gold rush of 1849.
But as good as things are, there is one thing we old-timers know. And that is it won’t last forever. Everything cycles. It always does. There are plenty of storm clouds on the horizon. We could have another pandemic. We could have political instability. Interest rates could go stratospheric. The stock market could crash, or we could get sucked into a war somewhere.
None of us can predict the future with precision. So it’s best to be prepared — especially if you are a business owner with employees and customers counting on your survival.
Here are some things I would be focusing on right now:
Reducing debt and converting what debt you have to have into the longest term, fixed-rate debt you can get. With rising inflation, you can expect higher interest rates. It’s inevitable. And you should do some back-of-the-envelope calculations on how costly that could be if rates go to 6%, 7% or even 8% or more. Just get yourself in a position where that, if it happens, it doesn’t impact you significantly.
Mark Zweig is the founder of two Fayetteville-based Inc. 500/5000 companies. He is also entrepreneur-in-residence teaching entrepreneurship in the Sam M. Walton College of Business at the University of Arkansas, and group chair for the Northwest Arkansas chapter of Vistage International. The opinions expressed are those of the author.
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Talk Business & Politics is a news website that covers business, politics and culture in Arkansas. You can also sign up for daily e-mail news delivered every morning to your inbox.

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