What Survives in a Down Economy

This is my opinion. I'm no economist. But my theory is that some businesses can do well in a down economy. I remember my grandparents' stories of The Great Depression, and I was surprised how many of my grandparents did OK during it. Evil Grandma Rose's family were bakers and had a bakery. People still needed bread, and whatever they didn't sell, they ate. Well, today we get bread in a supermarket, but I still think some businesses will do OK in a down economy.

Entertainment. Relaxation. I think that these will do well. Even when times are tough and it's hard to pay bills, people will want some diversions. They may not afford the vacations they used to take, or maybe any vacation, but they will still want to escape from things a bit. This is where entertainment comes in.

I know people who are going to sell their personal possessions to get their kid a Wii this Xmas. I know people who may cut some things out, but are still buying concert tickets for their favourite artists and tours. I think you may not buy the CD but you may see the tour. And these aren't cheap tickets. I'm still hoping to have a honeymoon this year, but I'm thinking about budgeting a bit less than before.

I think online sellers should do well if you have bargains. Now is not the time to open the boutique, luxury website with the $900 cigarette lighter (sorry to the person who recently called to show me her website). Now's the time to be high in the food chain, have the great prices, and get these things online. There are still things people need or want, but they want them at Walmart or lower prices.

I think eBay and many eBay sellers can survive in this economy. I think eBay should lower FVF because I think they're too high. Many sellers are paying 12-20% of their sale price to eBay and PayPal. That's going to be most if not all of many people's markups, especially on lower-priced items. I think eBay can stimulate selling if fees weren't such a huge chunk of the sale price.

I think that people will look to cut costs anywhere they can. One person who called me said that her accountant questions her on anything that costs more than $5 per month (for subscriptions). I think people will cut $5 anywhere they can. Cut $5 once, and you still can't gas up your car. But cut it in a few places, and it adds up. I think people will cut absolutely everything they can.

When it comes to eBay software companies, we are having a hard time getting people to sign on with the more expensive companies (not naming names). We know these are good companies and good services, and if we're recommending them, it's because they match the needs the client is expressing to us. But we can't get people to commit to such large fees. I even asked one of these companies to help me and give me some selling points I can use. They told me their system is more stable than other systems. OK, it is, but I still can't get people to open their wallets. They didn't seem to have anything else.

So eBay sellers are moving towards the less expensive software tools. And hey, if they have all the features you need, we're for that! I'm just mentioning this as part of the move this whole year towards people really wanting to cut expenses they don't deem as necessary. If one company wants $500 per month and another wants $300 per month, even if I talk the higher-priced one up, I am watching people choose the cheaper one time after time.

Posted at 05:00 AM in Just An Observation | Permalink | Comments (1) | TrackBack (0)