Reporting of Bad News ignore it!

12/02/2009 by info.

I will make a number of predictions with the risk of appearing a doom monger.

1. Some larger companies will be desperately trying to sell smaller subsidiaries, or they will be looking for buyers themselves in the next month.

2. There will be a number of well-documented failures of businesses in the next two months.

Why is this?

Well it’s because the quarter day rent payment will be due for payment on 25 March, and these companies will be well aware that they don’t have the money to pay their commitments. Especially given the weather over the last month or so, which will have affected these businesses cash flow.

So you now know this is going to happen we can all get on with our lives. But for the vast majority of people it will scare them and it will change their behaviour in the short term.

I have noticed over the last few years that when bad news is reported the number of enquiries for people wanting to buy businesses either stops or slows down, as people get fearful and worried about their person circumstances. A few days or weeks later enquiries pick up again.

The news media will report these events and report historical statistics and it will probably affect your business in the short term as well.

We have however already lived through these events and survived; your business is still trading and orders are still coming in, but still psychologically we get scared and delay long term planning issues.

Which is why the reporting of bad news is a self-fulfilling prophecy, it is a primeval response to impending danger, and if you stop running your business due to potential threats the chances are that it will affect your profitability.

The reporting of good news therefore is important, as the more good news stories people hear the more they will be inclined to make that large investment in the knowledge that they will not lose money.

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