Latest news with #economicdownturn
Harvard Business Review
3 days ago
- Business
- Harvard Business Review
Rethink Your Pricing Strategies Amid Economic Uncertainty
Details Transcript founder of the consulting firm Culture of Profit, says a crisis or recession is not the time to panic and slash prices. He says leaders should instead reevaluate their pricing strategy—or develop one for the first time—to better respond to customers during the slump and keep them when the economy recovers. Since this conversation took place in 2020, the crisis you'll hear them referring to is—obviously—the Covid-19 pandemic. But these lessons apply well beyond that moment—to any period of economic instability. Mohammed shares examples of companies across a variety of industries that created effective price strategies in response to the Covid-19 pandemic. Mohammed is the author of The 1% Windfall: How Successful Companies Use Price to Profit and Grow and the recent HBR article, ' Setting a Pricing Strategy Amid Ever-Changing Tariffs.' Key episode topics include: pricing strategy, competitive strategy, crisis management, customer strategy, economic downturns, economics, inflation, recessions, risk management, strategy HBR On Strategy curates the best conversations and case studies with the world's top business and management experts, to help you unlock new ways of doing business. New episodes every week.
Reuters
4 days ago
- Business
- Reuters
German unemployment rises by more than expected in May
BERLIN, May 28 (Reuters) - The number of people out of work in Germany rose at faster pace than expected in May, labour office figures showed on Wednesday, putting pressure on a new government battling to wrench Europe's largest economy from prolonged downturn. The office said the number of unemployed - already at a decade-long high in April - increased by 34,000 in seasonally adjusted terms to 2.96 million. Analysts polled by Reuters had expected a rise of 10,000. The number of unemployed people in Germany is approaching the 3 million mark for the first time over the last 10 years. Economic malaise has put pressure on the job market even against a backdrop of long-term labour shortages, adding to pressure on conservative Chancellor Friedrich Merz who has vowed to pull the economy out of two years of decline. The seasonally adjusted employment rate remained unchanged in May from the previous month at 6.3%, in line with a forecast by analysts in a Reuters poll. Excluding the pandemic, this is the highest level since December 2015. "The labour market is not getting the tailwind it needs for a trend reversal. Therefore, we expect unemployment figures to continue to rise in the summer," said labour office head Andrea Nahles. There were 634,000 job openings in May, or 67,000 fewer than a year ago, showing a slowdown in labour demand, the labour office said. The tariffs announced by U.S. President Donald Trump will deal a major blow - possibly putting the German economy on track for a third straight year of recession for the first time in post-war German history.
Entrepreneur
23-05-2025
- Business
- Entrepreneur
Why a Downturn is the Perfect Time to Grow
Opinions expressed by Entrepreneur contributors are their own. You're reading Entrepreneur United Kingdom, an international franchise of Entrepreneur Media. The ripple effects of global tariffs, slow GVA growth for 2025 (1% in the UK) caused by a weak end to 2024, and rising operational costs of £5.6bn following the April budget have taken their toll on businesses across every sector. For many eCommerce companies, these pressures have prompted a pause for reflection—leading some to scale back their immediate ambitions and shelve growth plans in favour of simply staying afloat amid the prevailing economic turbulence. At face value, this cautious approach seems logical. Business history is filled with cautionary tales of companies that raced ahead without securing a stable foundation. However, history also offers a compelling counter-narrative: countless businesses have used periods of volatility as springboards for growth. Instead of retreating—and risking the loss of momentum, investor confidence, and market position—these companies doubled down, investing in resilience and innovation to emerge stronger on the other side. A Delicate Balancing Act Throughout my fintech career, I've navigated these waters firsthand. From my own journey—and from watching others in the space—my advice is clear: economic downturns don't have to signal decline. In fact, they can create a powerful window for strategic growth. The key lies in striking the right balance between financial sustainability and measured expansion. While this equilibrium may seem elusive at first, it's entirely attainable with the right mindset, discipline, and strategy. Companies willing to look ahead—equipped with the right tools and mindset—can transform difficult market conditions into valuable opportunities. Put simply, businesses that remain proactive, disciplined, and transparent in their strategies will not only survive periods of economic turbulence—they will thrive beyond them. In doing so, businesses in sectors like eCommerce can emerge from downturns as more experienced, trusted, and effective operators capable of rising to any challenge. The Role of Data-Driven Decision-Making In uncertain times, visibility and confidence become indispensable currencies. The businesses that scale successfully are those capable of anticipating risks rather than merely reacting to them. Predictive insights—grounded in robust data analytics—allow founders to maintain control, even when external factors appear unpredictable. By leveraging data, businesses can pinpoint the initiatives most likely to yield high returns, allocate resources more effectively, and manage their financial runway proactively. Ultimately, data-driven decision-making equips leaders with the clarity they need to deploy capital strategically. Rather than taking a broad-stroke approach to growth, businesses can focus on initiatives that align with their core strengths and present the most direct paths to profitability. This targeted strategy reduces wasted effort, minimises financial risk, and creates a foundation for sustainable scaling—even in the face of the economic headwinds we're experiencing today. Transparency as a Strategic Imperative In parallel, times of uncertainty demand transparent and consistent communication with investors. The reality is—few understand the cyclical nature of markets better than they do. What investors value most is reassurance, delivered through well-defined strategies and clear evidence of foresight. When companies provide regular, candid updates, they build trust. This transparency reflects not only a strong grasp of financial realities, but also a leadership team with the insight and agility to steer the company through turbulent times. Moreover, transparent investor relations create space for meaningful conversations around strategic pivots, revised KPIs, and realistic growth targets that reflect current market conditions. Investors value clarity—even when the outlook includes challenges. Honest, grounded assessments foster stronger relationships and encourage a more forward-looking mindset, reinforcing trust and sustained commitment. After all, experienced investors know that short-term hurdles don't have to derail long-term potential. The Smart Way to Scale While transparency and data-driven decision-making are essential, so too is exercising restraint when scaling during a downturn. Growth for its own sake is not the goal. Instead, businesses must embed discipline and focus into their strategies, prioritising initiatives that deliver measurable, long-term value. That means moving away from vanity metrics like unchecked user acquisition or unprofitable revenue, and shifting focus towards profitability, customer retention, and sustainable market expansion. With all that said, scaling during a downturn inevitably rewards those bold enough to act with real purpose—so long as their approach is grounded in discipline. While competitors may retreat and conserve resources out of caution, the leaders who emerge strongest from challenging periods are those who see volatility not just as a threat, but as an opportunity to stand apart through smart, decisive growth. Striking this balance isn't always easy—but with the right tools and mindset, it's entirely within reach. A Refreshing Approach Economic shifts and slow GVA growth has marked 2025 with uncertainty, developing pause for the eCommerce industry deciding whether this is an opportune time to grow - but it might just be the perfect spot. Achieving the right balance between financial stability and how an SME can grow strategically is essential during periods of economic downturn. A leader must cut through the noise and remain disciplined with their goals, and focus their mindset on strategy, and strategy only. Businesses need lenders who can combine predictive analytics, intelligent cash flow management, and transparent communication tools. Founders must be empowered to make strategic decisions rooted in real-time data rather than only following their business plan. In doing so, businesses aren't just weathering uncertainty, but developing the tools to turn potential setbacks into catalysts for sustainable, long-term growth. By unlocking this capability it becomes possible for more small and medium-sized businesses to scale smartly—even in a downturn. Ultimately, by enabling companies to align their growth strategies with data-driven insights and transparent investor communication, a roadmap for navigating uncertainty with confidence is provided. Now is the time for businesses to seize the opportunity. It's not just about surviving today's challenges—it's about laying the foundation to thrive for years to come.
Bloomberg
21-05-2025
- Business
- Bloomberg
Baidu Reports Surprise Revenue Jump During China's AI Battle
Baidu Inc. 's revenue beat estimates, after China's internet search leader fended off intensifying competition in AI and a persistent economic downturn. Revenue for the three months ended March rose 3% to 32.45 billion yuan ($4.5 billion), when analysts expected it to shrink to 31.03 billion yuan. Net income for the same period came at 7.72 billion yuan.
Yahoo
11-05-2025
- Business
- Yahoo
As a recession looms, GOP lawmakers need to prepare NC. They're not.
Before he presented the Wake County budget on May 5, County Manager David Ellis weighed various national and state economic indicators, plus one he picked up at his barber shop. 'I listen to folks there,' he said. 'One was a car salesman who lost his job because they weren't selling any cars.' That salesman's misfortune fits with what Ellis and others see coming for the economy and the nation, a serious slowdown and a possible recession. Ellis had planned to draw a budget based on 3% growth in sales tax revenue. He dialed that back to zero. He wanted to propose a 5% raise for top employees. He capped that at 3.5%. 'During COVID, we had to adjust on a daily basis and that's something we're going to have to continue to do,' he said. Around the state and the nation, public officials are girding for a downturn that could become a crisis. Trump's tariff hikes are likely to slow the economy and extending his 2017 tax cuts for the wealthy could require major reductions in federal aid for food stamps, Medicaid and a host of other programs. But North Carolina legislative leaders are not among those preparing for the worst, despite the state being especially vulnerable. Years of tax cuts have hollowed state agency budgets. The vacancy rate among state employees is more than 20 percent. If a recession hits, the state will have little room to cut expenses, even as it copes with lower tax revenue and less federal funding. Unemployment benefits, capped at a paltry $350 a week, won't be enough to sustain workers who are laid off or buffer local economies. Alexandra Sirota, director of the nonprofit N.C. Budget & Tax Center, said she can't account for all of state history, but compared to recent decades, 'We are certainly the most under-prepared we've been for a recession.' Despite the darkening economic forecast, the state Senate's proposed budget calls for accelerating tax cuts that would largely benefit wealthy individuals and large corporations and more spending on private school vouchers. 'The Senate plan is completely unacceptable,' Sirota said. ' It is not a serious proposal for the moment our state is in.' The state House's budget proposal is expected to be released soon. Gov. Josh Stein's proposed budget, which will have little sway in the GOP-controlled legislature, rightly calls for a freeze on tax cuts and voucher spending and an increase in unemployment benefits to a $470 weekly maximum, but the governor should be sounding a louder alarm about the trouble that looms. The Urban Institute's latest tracking of state tax collections found that for median state tax revenues have declined compared to last year — and that's before Trump's tariffs have taken their effect. 'Recent federal policy actions and subsequent economic developments are poised to impact state tax revenues significantly,' the Institute's report said. Between a tariff-related economic slowdown and federal cuts to make way for an extension of the 2017 tax cuts that will cost $4.5 trillion over the next decade, states are likely to face overwhelming revenue losses with huge consequences. The Center on Budget and Policy Priorities ranked North Carolina 20th nationally in terms of federal funds as a percentage of state expenditures – 38 percent, or $34.5 billion in fiscal year 2024. If Congress cuts a significant share of that funding, all states will be in trouble. If North Carolina goes ahead with tax cuts, it will only compound the problem. The response, inevitably, will be to further reduce or eliminate critical services. A more humane response would be for the legislature to freeze scheduled tax cuts and impose an income tax of up to the state cap of 7 percent on very wealthy earners. That would claw back some of the savings they will get from an extension of the federal tax cuts. The NC Budget & Tax Center estimates that the state's top 1% of earners will save $1.8 billion in 2026 under the extension. Tax hikes, of course, are not happening under this General Assembly. Republican lawmakers have cut taxes repeatedly at the expense of schools and services since 2013. But now that the jig is up, the state has no slack and those who brought us to this vulnerable point seem to have no plan for the trouble ahead. Associate opinion editor Ned Barnett can be reached at 919-404-7583, or nbarnett@
