SIGNS OF RECOVERY, PART 2
In his Fortune Small Business column, journalist-turned-family-business-operator Kevin Kelly explains how he went from pessimist to optimist:
Anyone who knows me accepts that consistency is not one of my attributes. Now, dear readers, you too can join that club. Just a few months back in this column--last October, if you must know--I dubbed myself "Alan Greenspan's worst nightmare." No matter how low interest rates fell or how robust my business, I insisted, I wasn't cranking up spending or hiring. Last summer I even canceled the purchase of a $500,000 printing press. I just didn't believe in the recovery. My pessimism so enraged one reader that he labeled me "gutless" and "spineless."
Well, I've grown a spine. I have now embraced the economic recovery with wild abandon. My family's $30-million-a-year plastic-bag-manufacturing company has spent close to $1 million on new equipment over the past few months and plans to fork over another $1.5 million before year-end. That's almost triple our 2003 capital spending. We're buying a new printing press at double the price of the one I nixed last year. Thanks to my new friend the Fed, I'm still financing the darn machine at around 5.5%. We're not just on the bandwagon, we're virtually driving it: Unlike so many U.S. businesses, we've hired new employees, expanding our workforce 10% in the past few months, to 120.
Why the change of heart? I listened more to my business than to my macroeconomic fears. For months I allowed the media drumbeat about the fragility of the recovery and my paranoia about industry overcapacity and cheap imports to drown out what I heard in my businessï¿the pulse of rising sales. Beginning in mid-2003, our sales growth hit as much as 50% year over year and averaged around 30%, thanks to an influx of new customers and increased business from existing accounts. As backlogs lengthened, customers got angrier about late shipments. I recognized that if I didn't expand, our hard-won growth could disappear overnight.