The Seasons of Business
Girlfriends – Prepare for the four seasons of business.
Just like nature, a business has four seasons, spring, summer, fall, and winter. Some seasons in business can last a few months or even a few years, but the rotation of business cycles is unavoidable.
Think of farming as a business. Spring is the season when you plant the seeds and plants begin to grow. In the summer you have rapid growth, and the plants are in full bloom. Fall is when you are in the money, and you harvest your crops and store them for the winter. Winter is the slow season and when you are living off the harvest and all the hard work you cultivated.
When you are building your mortgage business you need to run your business according to the season it is in. You can’t treat all seasons evenly or you will be unprepared when winter eventually arrives.
Were you in business in 2008-2009 when the recession hit? Did your business get hit hard that winter? Were you prepared and able to weather the winter and recover so you could continue to the next season? Some mortgage companies did not fully recover, and then we had the pandemic and now another potential recession.
Each of the four seasons of business has its benefits and drawbacks. You need to create a strategy for each season so you can prepare for the challenges and take advantage of the opportunities.
After a potentially difficult economic “winter” which stretched through most of 2020 and into 2021 many businesses had a hard time, and some companies went into debt or bankrupt. Others received government assistance to stay afloat. Only the strong survived.
The mortgage business really played out well during the pandemic. During this time the Federal Reserve dropped the federal funds rate to 0%-.25%. This was intended to increase spending and increase lending. This spurred a large refinance and buying market. Lenders were having their best years ever.
In addition to low-interest rates, the industry had just come from the largest growth in new technology. This allowed the industry to not only survive but thrive during the pandemic. When other businesses relied solely on face-to-face, the mortgage industry was able to utilize the technologies to do everything remotely.
During this time many mortgage companies expanded their business and went into a high growth mode. Spring is often an excellent time to hire as more people are unemployed and looking for new opportunities. This was a great opportunity to grow your business