Tarred with the same brush...

Some time ago (I'm unsure when--call it another in the ongoing series of "Senior Moments") I mentioned that I had deserted the long-held premise that our business is aligned with retail sales.

I came to this conclusion because the retail sector had rallied smartly from its 2007-08 decline while our business had not. I came to realize that our business has NEVER been aligned with retail sales--it just seemed that way and we told ourselves this lie enough times that eventually even we believed it.

And although all signs are pointing to a recovery in our market--especially from the casinos--there is still no link between retail and us. I'm wondering if there may be another link--one we don't typically consider. What if our business was tied to INVESTMENT?

One of the biggest challenges we have is trying to get our clients (end-users in particular) to consider rewards and recognition as investments rather than costs. We failed in that endeavor in 2008-09, when programs were whacked with an efficiency that even "Chainsaw Al" Dunlap would have been proud of.

And today, corporations are sitting on $2 trillion in cash. Time Magazine says that the issue for companies isn't profits--they've got lots of those--it's the willingness to invest. And most of us can recite examples of this conundrum, where clients say they have the money, but are concerned about the risk of economic conditions.

Some pundits are saying we're heading for 2 Scoops of Fun--also known as the Double Dip--and if that happens the furtive signs of a recovery in our market will be snuffed out like LeBron James' goodwill with NBA fans. All this at a time when retail sales have GROWN by 7.7% in the past 12 months.

It seems to me that our end-user clients are sitting on mountains of cash that they're holding for a Rainy Day. They seem unwilling to build new plants, or hire new employees, or (surprise!) invest in reward and recognition programs. And any Bad News will hurl us again down the rabbit hole.

We might be well-served to consider what companies are doing with capital investment, or employment trends, rather than clinging to our old beliefs. The statistics people tell me that Correlation isn't Causality. Neither is Coincidence...


Pete