Times of rapid change turn prognosticating magazine columnists into gamblers. That said, two things I know for sure:
One, we are back to earth, and that forces us to adapt for survival. It turns out that neither billions of hard-working Chinese and their savings, nor our massive ingestion of Prozac, were enough to keep the high-flying
But, gosh, doesn’t it feel good to have the solid ground of reality under your feet again? I, for my part, am happy because the gravity-defying “capitalism without capital” of the past two decades made me nauseous. My hope is that the crash of Wall Street’s highly leveraged investment bankers also brings down the casino they had built for us to play in—a transactional economy where the main entrepreneurial motivation had become the quick buying, merging and selling of assets produced by others, using other people’s money.
It looks as if the grounded way of doing business—patiently producing things while accumulating capital—is staging a limited comeback. Like it or not, we must now go “cold turkey” on borrowed money and turn our business thinking from a short-term transactional mindset to a long-term productive one.
But there are plenty of opportunities out there. What will help in this shift—and that’s my second “I-know-for-sure” point—is the fact that dynamic markets exist beyond Lakewood Ranch.
This is old news for the folks who run one of the most grounded larger businesses in our area, Sun Hydraulics Corp. The manufacturing company, founded more than three decades ago by Sarasotan Bob Koski, has been selling and producing its widgets—hydraulic cartridge valves, if you care to know—on three continents. And thanks to this geographic diversity, the business is on a steady course in times of upheaval. Sun Hydraulics had a net profit of $23 million through September 2008. Sales and profits will likely be lower next year, but the company’s even-keeled way apparently has a calming effect on jittery investors; Sun Hydraulics stock has been fairly stable and is trading not too far below its all-time high.
The people in charge of a similar-sized economic asset in our region, PGT Industries in
Here’s the good news for PGT: There’s a world of opportunity beyond the new subdivisions of the U.S. Southeast and condos in
As I am writing this, I am sitting in a café in the gritty but bustling downtown of
When driving through the periphery of this industrial city of four million, the business opportunity for the PGT’s of this world is obvious. Even though private bank credit is getting tighter, improved government lending programs keep fueling the construction of thousands of tiny townhomes in
It’s the same story in
What will be driving this growth is the subcontinent’s effort to turn its biggest burdens into an opportunity: building and modernizing the region’s sorely lacking infrastructure, and—more importantly for
Here’s the tricky part: Since the private sector has been reluctant or absent in some countries to engage in these undertakings, the state took the lead role, staging a big comeback as an economic actor. This is not just the stuff of Raúl Castro and Hugo Chávez anymore. The finance minister of
Doing business with the state usually requires first partnering with well-connected local partners. And being at the whim of politics in a foreign country isn’t for the weak-hearted either.
But the rewards can be big.
Consider this opportunity in two smaller markets beyond the beaten path: A housing deficit of about one million units aside, three hurricanes that hit Cuba this season damaged or destroyed half a million homes. Resources are tight, but it’s one of the Cuban government’s top priorities to help citizens rebuild their homes while continuing to build new ones. What’s more, while it will take the Obama administration and the Democratic-run Congress to lift the
The biggest partner in
It takes thinking outside the box to take advantage. But everybody with a stake in PGT should make sure the folks in
In that vein, it’s getting much more comfortable lately exploring the business opportunities south of Lakewood Ranch. All it takes to hop on a plane is a two-hour drive to Orlando, where Brazil’s TAM airlines has started daily service to São Paulo, in addition to the 28 weekly flights it already offers from Miami.
JetBlue announced it will start daily flights from
And Mexican carrier Mexicana began daily flights from
This is great news in tough times for
Johannes Werner is a Sarasota-based business journalist who has worked in Europe,