FedEx Chairman Fred Smith
Originally uploaded by marylandcpa.

Can the economy keep going strong in 2007?

I heard FedEx Chairman Fred Smith give his insights into the global marketplace and the future of U.S. businesses on New Year’s Day. Smith said he thinks the future is very bright, and I agree.

He did an amazing job of putting things in context in a way that made a lot of sense.

Smith made the case that we should not see major long recessions anymore due to today’s more efficient and connected supply chains. In the old days, slowdowns would take almost a year to work their way through the supply chain, from retailer to wholesaler and manufacturer. With the advent of companies like Dell, Wal-Mart and just-in-time manufacturing, inventories are measured in days, not months. Thus, we will expreience a series of mini-recessions in industries as they react to slowdowns. Makes sense to me.

He went on to talk about the top three trends affecting U.S businesses:

  1. Globalization and opportunities in emerging global markets.
  2. Web and technology connecting the global marketplace.
  3. Production of higher added-value products in the U.S.

Bottom line: If you are not positioning your busines or clients to deal in a better-connected global supply chain and marketplace, you’d better start now!

What do you think?

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