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Leaders stay the course

Leaders stay the course

Posted on:  , 
Author: Ed Straw

The results of the latest ATB Business Beat are very interesting to me. On one hand you have the vast majority of Alberta small and mid-sized business owners saying, yes, the success of their company’s future is tied to the price of oil and the overall provincial economy – which they don’t see making a recovery any time soon. Yet, 83% still remain optimistic that their business will be the same or better off six months from now. How can that be?

If you say that you are tied to the ship (the economy and oil prices) and that you know that the ship is taking on water, how can you logically state that you are not going to sink with it? Are Alberta business owners wearing rose-coloured glasses? Are they naive in thinking somehow it will magically all work out? Or are they optimists who believe that they can control or at least influence their own destinies?

In his book, Against the Gods, the Remarkable Story of Risk, the late Peter Bernstein says: “The capacity to manage risk, and with it the appetite to take risk and make forward-looking choices, are key elements of the energy that drives the economic system forward.” He further mentions that risk management is a balance of using what we know to be true and what we believe may happen by interpreting the past and taking a course of action.

I believe that most Alberta business owners are well-seasoned and resilient optimists. They know the past and they understand what might happen. They simply need to take charge and lead their company through this uncertainty.

At ATB we have a saying “leaders stay the course”.

For business owners, it means you need to challenge every assumption. Drive your break-even point lower by cutting discretionary spending and becoming more efficient with less. Know your monthly burn rate. Make sure you have access to working capital – it is very likely you will need it. Talk early and honestly with your banker and ask for help on things like postponements of principal payments, extension of amortization on assets, consolidation of loans, or interim financing. There are lots of options.

For ATB, staying the course we will continue to stand by Alberta businesses even when the going gets tough. We have proven in the past that our support during economic downturns has increased even when other FIs see their financial commitments to business owners go down. And we don’t anticipate this time will be any different.

So saddle up folks. This ain’t our first rodeo, but we’ve been through it before and together we can get through it again.

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