Pivot into profit: ‘Pivot’ is 2020’s new catchword and, given recent events. For a good reason, especially if you want to thrive in this economy, not just survive. As always, we want to talk about current events and how to set you up for financial success, so here’s your guide on how to ensure you can pivot into profit moving forward.
What is the ‘pivot’?
As COVID-19 flipped the world as we know, pivoting became a buzzword of social media. What is it communicating? Simple words have the ability to help you become flexible and nimble. And to survive in these challenging times.
There’s never has been a more important time to be able to pivot your way through the economy, your business and within yourself.Andrew Baxter
Pivoting within the economy
Technically speaking, we’ve been in a classified ‘recession’ for the past 6 weeks. Our GDP is negative growth territory. Unemployment is at an all-time high, and consumer spending is down immensely. However, we’ve lived up to our name as the ‘lucky country’ for the last 30 years, as everything Australians have touched has turned to gold.
We have a roaring property market, steady increase in the stock market, great government benefits, and high job security. Indeed, the lucky country.
Who would have thought that after 30 years of boom time, we would fall into an economic recession?
Andrew Baxter, however, has felt that thinking forward is the ability to adapt to the situation.
Pivoting your business
The reality is unless you’re prepared to roll up sleeves and adapt to the current environment, you won’t survive. However, it’s the wake-up call that some archaic businesses need to make the necessary changes as we move into tomorrow.
For example, QBE Insurance Group has canceled their retail insurance provisions to both David Jones and Myer. What does this mean in layman’s terms?
A life insurance provider won’t cover you if they think you’re already dead. Myer and David Jones are historically facing businesses that rely heavily on foot traffic. However, they’ve failed to adapt to the new online shopping revolution. Such slowness and an outright refusal to pivot will most likely lead to the demise of these long-standing Aussie businesses.
On the opposite end of the spectrum are Amazon and Zappos. Not only do these businesses have a massive online presence, but they are also obsessed with customer service and the innovation of technology. These are nimble businesses that have pivoted their way through the business environment and the results show for it.
Pivoting yourself falls into two categories:
- your investments
- your personal developments
In terms of investments, typically most Australians have bought an investment property that has been tenanted with no problems. Their blue-chip stocks have increased in value and have a semi-annual dividend paid fully franked. Up until now.
Now, 1 in 7 investment properties are left untenanted and dividends have been cut completely by most ASX companies. The past may have been great, but keep moving forward and evolve your investment strategies with the current conditions.
In terms of personal development, the best advice host Andrew Baxter can give is to reduce your dependency on your job and have a side hustle – a topic we covered in a recent podcast episode.
Not only this gives you an extra source of income, but it also ensures if things get any worse – you protect because you learn to pivot.
At the end of the day, there’s no harm in learning a new skill that helps you make more money!
If investment in the stock market is something that interests you, but you don’t know where to begin, reach out to Andrew’s team at Australian Investment Education to see how you can generate up-front income out of the stock market.
Pivot may be a hot topic in today’s culture, but let’s remember the importance of being agile. No one wants to stuck listen to cassette tapes when everyone’s move on Spotify.
Want to hear more? Subscribe to the Money and Investing podcast today!