THE MOST RELIABLE BUSINESS OF ALL

The best way to weather the recession is to get as many public sector contracts as possible.

The paperwork can be a pain, and delayed payment can be an even bigger problem than in the private sector, but governments still have money when no one else has.

Of course, even politicians are now having to talk – belatedly and unconvincingly – about cutting expenditure.

We will believe that when we see it.

In any event, there is one potential source of income that will remain reliable no matter how bad things get: global military expenditure actually increased last year.

Unhappily, there is no sign of that changing in the near future. American activity in Afghanistan is increasing, and Pakistan and Iran appear to be on the edge of civil wars.

There is money to be made from warfare– at least by those who can reconcile their activity with their moral and political beliefs.

Those who know their Star Trek will recognise the 34th Ferengi Rule of Acquisition: “War is good for business”.

That rule is sometimes confused with the 35th Ferengi Rule of Acquisition: “Peace is good for business”.

Which rule applies depends on what end of a weapon’s life cycle you happens to find yourself. 

Comments

June 18. 2009 02:51

Oz Rhodes

I would agree that, normally, the best way for Government to lubricate the wheels of commerce in a recession is through increasing contracts from the MOD.  This puts money into the pockets of workers in the traditionally industrial heartlands and drives the economy from the 'bottom up' (no class judgement made here).

Unfortunately, the MOD seems to be letting less contracts and National and Local Government is cutting back on spend in a dramtic way.  Additionally, there seem to be some signficant barriers to entry within local Government as even being accepted to the preferred supplier list does not signficantly increase your chance of being considered for a contract or even reducing the competition significantly.

Networking and aligning with an incumbent provider seems to be the most effective strategy unless you can provide a credible offering at rock bottom prices and as a small business, your overheads may be small, but your economies of scale are also small.  Larger companies are more able to 'undercut' you with the change of generating additional revenue through finding additional opportunities that they can resource and that you may not be able to.

Great food for thought here Guy.  Keep up the posting and the encouragement.

Martin

Oz Rhodes

June 18. 2009 09:42

Stuart Fairney

I have learned to my cost the wisdom of rule 94 many times.  

Stuart Fairney

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