While the economy’s growth is uncertain in early 2020, snack manufacturers should take advantage of low interest rates and readily available lending to invest in their companies — and do it now. Doing so will allow them to prepare for the next cycle as the economy expands from the second half of 2020 through 2022, said Brian Beaulieu, chief executive officer and chief economist at ITR Economics.
“We’re going through a little slowdown in the economy,” Mr. Beaulieu told attendees at SNAC International’s Executive Leadership Forum late last year. “It’s not the end of the world. My biggest concern is, are you ready for the rising trend that is going to follow?”
Mr. Beaulieu said key leading indicators and the firm’s proprietary research show the U.S. and global economy ramping up in the second half of 2020.
“In 2021, you are going to be extremely busy, and you are going to be busy into 2022,” he said. “I don’t know if you have enough people to make that happen. I don’t know if you have enough working capital to make that happen. I don’t think you have enough energy in your bodies to make this happen. You are going to need all of these things.”
In recent years, the snack industry has outperformed other food industries, but it isn’t immune to broader economic cycles. However, from Mr. Beaulieu, one message is clear.
“What you should be planning for is the next cycle, and the next cycle is going to have a nice rise to it,” he said.
That’s a strong signal for capital investment and great approach to take toward your business in the New Year.