In light of the recent stock drop, fears of a Greek debt crisis, a busted housing market and high unemployment, The Street surveyed four CEOs to establish how they feel things are going now, and how things will end in 2011. The general consensus among them seemed to be that sluggishness is expected now and that the future is too unpredictable. Both Panera Bread and Tata Communications CEOs placed emphasis on investing in the consumer experience and placing a focus on improving products and services for their customers. For more on this continue reading the following article from The Street.
The stock market has a lot to worry about these days. The latest albatross has been the persistent Greek debt crisis, not to mention low employment and weak housing data.
The Dow Jones Industrial Average is down almost 1,000 points from its late-April highs of the year. With this precarious backdrop, TheStreet asked business executives the following question. In light of weaker-than-expected economic data, are you planning for a double-dip recession? If so, what steps are you taking?
Bankrate (RATE) CEO Tom Evans, whose company’s shares began trading Friday, said: "I think it’s a segregated economy to be honest. For the 80% of the people that are not upside down on their houses and have jobs — the world’s their oyster. It’s a very competitive environment for their business. For the 20% of the people that don’t have a job, that are upside down on their house that have poor quality — it’s a very challenging environment for them to get a financial product.
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CEO David Flynn of newly public Fusion-io(FIO) told TheStreet that he is not going to be distracted by talk of a double-dip recession. "I would have to leave that more to the analysts," he said, during an interview on the day of the company’s IPO. "We’re so focused on our business and telling our story and customer adoption of the product."
Tata Communications(TCL) CEO Vinod Kumar: "What we are planning for is sluggishness," but not a double dip, Kumar said. "We are seeing that the economy might go sideways for a while. We may see some occasional bursts of growth followed by some contraction."
There has been some benefit for Tata Communications as U.S. companies look overseas for growth. "We are there where the growth of U.S. businesses is going now and will continue," says Kumar.
Panera Bread’s (PNRA) chairman, founder and former CEO Ron Shaich: "I don’t think any of us know what’s going to happen in the future. If we did, we would probably be in a different business. We really can’t control the externalities.
"What we do try to do is keep a conservative balance sheet and a lot of capacity; we have no debt and a fair amount of cash. We want to continue to do what we’ve done for several decades: continue to invest in the consumer experience, continue to invest in the things that will drive competitive advantage. It’s worked for us in good days; it’s worked for us in bad days. It will be what we continue to do."
This article was republished with permission from The Street.