May, 2008

Defeating the Dismal Science

How to stay focused as economists shout "recession!"

By Rick Schumacher

There’s an old joke about what to do when you want a little extra space on a crowded plane. Ask the person seated next to you what they do for a living. When they’re done, just say, “I’m an economist, and here’s what I think….” Bingo, empty row.

Perhaps this is a harsh judgment (and slight exaggeration) on those who practice what Thomas Carlyle pegged “the dismal science.” But it’s a natural response to the steady drumbeat of headlines proclaiming economic doom and despair. As I write this, the debate as to whether or not we’re in a recession has changed from “are we in a recession?” to “how long will it last?”

Words are powerful. Repeat something long enough and eventually, it becomes fact. Many believe, and I’m among them, that doom and gloom headlines make economic downturns happen sooner, run deeper, and last longer. Think about it…. Even as the economy was pulling out of the last recession in the second half of 2003, caution was
the watchword for many.

Now that most experts agree that we’re in a recession, what should you do? Let’s start right here, right now. Having weathered numerous recessions with you (we launched LBM Journal during the last one), I know first-hand that it’s anything but easy. While not every company will survive, there are definite steps you can take to increase the
odds that you will emerge from the current downturn stronger than ever. Those tangible,
actionable steps can be found in this and every issue of LBM Journal. Here are three highlights from this month’s issue:

Bill Lee on Sales & Margins. Widely known and respected for his knowledge and experience in running successful lumberyards, Bill Lee’s monthly column is packed with relevant-in-the-real-world advice. This month, his message about using this slow time to ramp up your marketing comes complete with two action steps.

John Wagner on Green Building. LBM Journal’s resident expert on green building has a clear focus for each monthly column: provide insights to help you cut through the confusion and clutter, and to understand what green building means for you and your customers. This month, he focuses on formaldehyde—what it is, why it’s bad, and its role in green building product choices.

Tom Fife on Management & Operations. As scores of LBM dealers from coast to coast will attest, Tom’s trademark enthusiasm is second only to his in-depth knowledge of what it takes to run an efficient, profitable lumberyard. This month, his focus is on operations.

These three, along with Gary Katz (on selling craftsmanship), Steve Easley (on building science), Bob Heidenreich (on selling the deck project) and Bob Buck & Dave Klun (on selling to remodelers), pack more than 200 years of “been there, done that” experience into every issue. You may find magazines published by bigger companies, but you won’t find any that can match the relevance of this editorial team. I’m proud to work with each one of them, and thank our advertisers for providing us the means to deliver their insights issue after issue.

My advice: the next time you’re tempted to read a recession-themed article, pick up an issue of LBM Journal instead. Or log on to our newly redesigned and relaunched website at www.LBMJournal.com, where you’ll find a rich archive of articles and columns from past issues. Here’s to keeping the dismal scientists at bay for at least one more month.