Industry prosperity can’t last forever, but preparation now can help you be ready if – and when – the cycle ends.

The A/E industry is hot right now, People! The overall industry is as healthy – or healthier – than I have EVER seen it in 35 years in this business. We have seen some companies doing incredibly well. Growth rates are up. Profits are high. More people are making more money in this business than I have ever seen. It really is something. But, a word of caution: If you are successful right now, make sure it is because of what you are actually DOING as a company and not in spite of it. If you are just riding the wave of a supply shortage combined with high demand, you could be in BIG trouble when the cycle ends (which it always does). Here are my thoughts:

• Make sure your marketing is working and you are getting good jobs with clients who enhance your reputation and pay their bills promptly. A good brand will help you survive the next downturn. Minimizing marketing investments NOW because you can get away with it will ensure suffering later.
• Take care of your people. Yes, you may have made a lot of sacrifices, cut your pay every which way to Sunday, and made less in the bad times and now are making hay and feel you deserve it. You probably do. But don’t forget about the good people, too, who are making it happen every day. I’m not talking about everyone in the firm – everyone has some less-than-star-performers – but your best people can’t be forgotten now that times are improving. If you do take them for granted, they could be gone.
• Get some money into some other assets. Look – I love private firm ownership and love to see people reinvesting in their own businesses, ones they understand and ones they control. But I also realize the benefits of SOME diversification. Your 401K is part of that, but let’s face it, we’re all pawns in the scheme of things when it comes to the public markets. Someone always knows more than we do. I would be looking at real estate (it is still favored tax-wise), other businesses you have an interest in or want to get your kids or other family members into, and even investing in hobbies such as classic guitars or antique cars (antique cars, by the way, have done better supposedly than any other investment over the past 20 years). Get some money into some other stuff, so if it gets ugly, you won’t wash out.
• Look ahead. Think about what you really want to do with what’s left of your life. You may live into your mid-‘90s like my parents, who still live in their own house and drive daily. Or you may die next week from an illness you don’t even know you have. Either way, you should be planning for your exit from the company. Who is your successor? Does this person know it? Does everyone else know it? If not – or if you don’t have one – get on it NOW. The value of your ownership – the very fate of your company – depends on it.

I hope these good times continue. But if they don’t – and you know they won’t – it’s best to be prepared. Mark Zweig is president and CEO of Zweig Group. Contact him at mzweig@zweiggroup.com. ​© Copyright 2015. Zweig Group. All rights reserved.