The current economic crisis in Ireland is like nothing I’ve seen before in my lifetime. It’s my first recession, and it looks like it’s a serious one. People close to me are losing their jobs and/or leaving the country for better opportunities elsewhere. Things are looking fairly bleak and the country is in free fall. But we can’t all leave, and we can’t all hide from these problems. Some of us will have to step up and take part in fixing the country. In creating value in our economy once again.
Growing Exports from Indigenous Companies
The answer to this is to build up and expand our export market. We’re not competitive anymore in areas like production or manufacturing so we need to think outside the box. Much of our export economy right now is heavily reliant on the large US companies who have operations here. But the recent announcement from Dell to close their plant in Limerick with the loss of 1,900 jobs is a stark reminder that these large multi-nationals will only stay here for as long as it’s profitable to do so. What we really need is to nurture and expand our indigenous Irish owned export economy.
Technology To The Rescue
Right now, our best chance of success is in the technology sector. We’re a nation of brainiacs, full of great ideas, talent and motivation. We’re perfectly positioned to fix the current crisis. All we need is to organise, focus, prepare and then to just go out and do it.
There’s a growing community of Irish startups, each of them bringing passion, energy, innovation, and the right skills to execute their ideas. I believe that it’s this group of companies and others like them that will lead the way for the regeneration of the Irish export market.
Lets look at this crisis in another way, lets be more optimistic. This recession might not the nightmare it’s being made out to be. Instead, it could be the single biggest opportunity we’ve ever had to reshuffle, reorganise, reposition, regain our competitiveness and kick some serious ass in the international technology sector.
Now that all the stones have been unturned, there is nowhere to hide and we’ve got no choice but to hit this crisis head on with smiles on our faces. And I for one am looking forward to it.
A Plan For Success
I’ve got a three point plan to maximise my opportunities during the downturn. These are tips that anyone can adopt in their business, doesn’t matter what you do.
- Generate passive recurring income
- Export your skills and your products
- Focus on a niche and kick the ass out of it
Generate Passive Recurring Income
There were two main causes of the property bubble. The first was the fact that property development is a once off job. After a house is built and paid for, that’s it. No more revenue could be generated from it. The developer had to move onto another project and build yet more houses to keep his revenue up. The second problem was we were selling to each other, at ever increasing prices. And they were doing all this, just to stand still.
I hope that the lessons learned from these catastrophic business practices will mean we won’t be likely to repeat them again any time soon. So what else can we do? How can we guarantee a steady income stream into our businesses that are genuinely sustainable?
The answer is to generate passive recurring income.
Like most of you know, I work in the web industry and right now the big buzz is software as a service (or SaaS). This is the concept of renting software to your clients in return for a monthly fee. If your clients are happy to continue using your product, then they’ll be happy to continue to pay you. It’s a simple business model with one major advantage: the revenue is stable, recurring and can be expected to grow on into the future.
Even better, would be to build a product that required no interaction or ongoing work on your behalf. That’s where the ‘passive’ part comes in. This is a scalable simple idea that will become the norm in the software industry over the next 5 years (it already has to some extent).
If your business isn’t a web based business, don’t worry, there are loads of different ways to apply this and the web is just one of them. Try to think of how you can get your customers to ‘subscribe’ to your service or product. Once you’ve figured that out, you’re half way there.
Export Your Skills and Your Products
Despite the fact that the whole world seems to be struggling economically now, nobody seems to be suffering quite as badly as we are (except maybe Iceland). This means that there’s money and customers waiting to buy your products literally just over the horizon.
If you’re struggling to pick up customers in your local area, why not broaden your geographic target and go after customers abroad? The Internet has levelled the playing field in loads of industries, and you’re just as likely to land a contract for a client with offices across town as you are with one who has offices half way round the world.
Stop thinking local and start thinking on a global scale.
Focus On A Niche And Kick The Ass Out Of It
Leave being all things to all people to the over zealous and the old school, pick a niche and kick the ass out of it.
Never before has there been a greater opportunity to build highly specific tools for small groups of people. Like Richard Feynman said in his famous speech in 1959, ‘there’s plenty of room at the bottom’, there are a massive number of problems for small groups of people that still needs to be solved. It’s these ‘verticals’ that provide the best opportunities for new business in times like these.
This is where we come in.
The barriers to entry and the cost of getting started with an online product are ridiculously low nowadays. Anyone can do it. All you need is a laptop and an idea.
Once you’ve got your niche, build products for it with razor sharp focus. Provide features designed just for them that no ‘off the shelf’ offering could possibly provide. Make your product indispensable to those people, so they couldn’t live without it. Fix all their problems for them and do it at a reasonable price.
You could only hope to do this in a really tiny niche, so don’t worry that it’s a small market. Once you’ve become indispensable to them other opportunities will pop up, I guarantee it.
Out Of Every Crisis Comes An Opportunity
This is how we will dig ourselves out of the hole we now find ourselves in. By taking advantage of the global market and building new products that solve simple problems.
This recession doesn’t have to be all doom and gloom. It’s a chance for us to become agile again. It’s an opportunity to reinvent ourselves.
If you doubt me, I’ll refer you to the Chinese people. They’ve known this for a millennium. That’s why their Mandarin symbol for the word ‘crisis’ is the exact same as it is for ‘opportunity’.
Now get out there and do something.