What does it take to be successful in business? You’ll need a strong idea, a talented and hardworking team, reliable suppliers and an adequate customer base. Whilst these things are enough to begin with, however, over time you will need to be able to adapt as the world changes around you.
This means you’ll be able to anticipate and understand changes, and that comes from understanding what’s going on in the economy more generally. You need to look beyond your own business and your own sector and connect with the wider markets.
Identifying problems and solutions
Following the markets significantly decreases the risk of you being blindsided by sudden changes that you’re not prepared to cope with. It can give you the warnings you need to do things such as buying up extra stock, setting aside capital, or diversifying in anticipation of slowing demand for your core products or services. You can look out for problems likely to impact your trading partners or decrease the disposable income of your customers. It enables you to monitor the general health of the economy without relying on what the media or politicians tell you, and if you’re good at it – which mostly comes down to being diligent and not letting your emotions interfere with your judgement – you’ll gain insights that allow you to get ahead of your rivals.
One way to learn how to understand the markets is to go to university and take a formal degree course in business, finance or economics. If you’re busy with your business and can’t afford the time to do this the traditional way, there’s always the option of correspondence courses, with some quite prestigious institutions now offering them. You can do these part-time and have a lot of flexibility with your hours.
Nothing really beats direct experience when it comes to understanding the markets. Learning how to trade Forex isn’t as hard as you might think, and the emergence of online trading floors means you can now practice it anywhere. It’s a good idea to start out by making “virtual” investments – pretending you’ve invested money in particular stocks and following how they progress and what you would have gained or lost. This will help to get you into good habits. Avoid making impulsive decisions or getting sentimental about particular options, and you should be fine. All you really need to do is try to sell assets for more than you paid for them (taking general inflation into account), but be ready to cut your losses if necessary.
The more time you spend getting to know the markets, the more you’ll be able to see your business as part of a bigger picture and adjust the way you manage it to make sure it’s always in a good place. Despite the hype, there’s no magic to it. It’s something that anyone can do, and it could help to give your business the edge it needs.