The widespread shrinkage of demand in the world economy has been stunning. I’m talking about demand, that is, in the sense of individuals and businesses following through on their desires to make purchases. Consumers are not making those regular visits to the malls, and businesses are hanging on to what money they have for the sake of caution. But a certain amount of the demand isn’t really going away. The desire to buy certain kinds of things is still there but their purchases are simply being put off.
My guess is that while purchases of the big ticket items such as cars and refrigerators will be the slowest to recover, people will get around to buying smaller priced (and less durable) items — socks and underwear, for example — sooner rather than later. So if you’re looking for the silver lining in this recession, think about the goods and services in your industry that are lower-priced and need more frequent replacement, and focus your business there for the short term. When the economy recovers, and it will eventually, then you can consider retooling your business and upgrading what you offer.