The economic crisis will claim many failures, but there will also be plenty of winners, according to a book from PA Consulting Group. In 'Surviving and Thriving in the Economic Crisis', Mark Thomas says the key steps to being a winner are maximising liquidity; diverting capital aggressively from poor businesses; and being bold enough to act quickly to pick up the bargains resulting from the demise of your competitors.The losers will be those who fail to secure their liquidity, focus on traditional cost cutting and ignore the bigger picture, or those who miss out on the opportunities.
In most sectors, say PA, there are large numbers of companies whose liquidity is in doubt. Many of these companies won't survive. But for companies whose finances are robust the recession offers once-in-a-lifetime opportunities: weakened competitors will see their share prices fall to levels which make them an attractive acquisition; they may sell their crown jewels to raise cash or they may simply disappear, reducing the over-capacity which exists in so many sectors. High-quality assets will become available at bargain basement prices. Well-positioned companies can achieve a decade's worth of progress in two years.