Today, anyone who wants to sell their bakery should think three times about that decision, and after decades of prosperity, the economic crisis, the recession and global stagnation have long been predicted, and the coronavirus pandemic has triggered this predicted crisis and multiplied it.
The world is on the brink of a crisis, as we've been taught in history books, and I mean the great crisis of the 20th century, and in this situation, it's more of a disadvantage to sell a bakery, but if you don't have a choice and you have to sell your bakery, it should be expensive.
W-MOSZCZYNSKI-2020-5-10– Why shouldn't the flames
== 2 to sell today?
Bakeries produce basic necessities, regardless of the state of the economy, the bread consumption level does not change, which means that the bakery is resistant to some extent to any crisis or recession.
Today, no one can actually say what will happen to our economy — that we're still driving luxury cars on great roads, and the shopping malls are tempted by the huge choice of service goods — it's just the momentum of an economy that's slowly going to lose momentum.
With its extinction, our standard of living will decline.
You can already see the disappearance of shops and service points today. People are losing their jobs, all kinds of activities and services are disappearing in our environment. There is deflation in the area of industrial products and inflation in the prices of fruits and vegetables caused by another drought and an influx of Ukrainian workers.
With the economic slowdown, inflation, poverty and social tensions can emerge as a result of bad government policies, and in this unpredictable, unstable world, the bakery will always be an oasis of peace and stable incomes.
That's why a lot of guys from other industries are gonna come knocking on our doors to buy a bakery as an organized, operational enterprise, with employees, a network of shops based on a brand.
If anyone has to sell it, let him do so at a disgraceful, Bazoan price, because that price today may prove to be real.
I'm not sure.
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The first sign of the crisis is the layoffs, and there are more and more empty rental store sites, and anyone who's been to countries that have been hit by recessions in the past has noticed many empty shops, abandoned workshops, and shops that even in times of prosperity have failed to find investors.
Mass redundancies are driving down demand, which is causing more redundancies and bankruptcy for companies, and that's the classic recession mechanism, and the economy is shrinking and GDP growth is falling below 2%.
The Poles have never experienced the phenomenon of a modern recession.
So, the socialist world was too poor and devastated to experience a major crisis, and socialism was itself a major crisis, and there were no developmental setbacks, because the economy as a whole was developing too slowly.
The experience for Poles is worth knowing how to handle this situation.
What a baker should do during the Great Recession
People who have stable and secure incomes during the Great Depression are particularly well positioned. In a normal economy, everyone has the same purchasing power and credibility. In a crisis economy, those few who have maintained financial stability and credibility can make a fortune.
The last line of defense against bankruptcy is the sale of assets and real estate, and because the recession is a mass phenomenon, real estate prices will soon start to fall, and in a few months, there will be opportunities to buy lots or stores that we couldn't afford before.
Commercial banks have never operated in Poland during a real recession. They are holding on to loans. It is easy to see that during a recession these loans will be needed more than ever by companies.
Banks will want to offset the risk of lending by raising costs, and someone who maintains financial stability and reliability under these circumstances can get a loan on much better terms, can get a lot of cheap loans.
In the great crisis of the 1920s, when the society was poor and few made a fortune, the specter of the great crisis has reappeared today.
The only known way for humanity to overcome the crisis is to force supply by creating huge state investments, and so in the 1930s, the world economy emerged from the crisis, led by Germany and the United States.
We don't know if this method will work this time, but today, besides the classical recession, we have two other phenomena that go along with it: a pandemic of the virus (which we already knew would be not just a seasonal incident, but a recurring phenomenon) and a deepening, catastrophic drought.
If there is no collapse of the state and banking system, if there is no global anarchy, it seems that bakeries will be an oasis of peace and prosperity.
So there comes a time when bakery owners will be able to sell more quickly, they can significantly expand their sales market by taking over their retail outlets, they can get cheaper loans to expand their stores, and they can demand lower rents for shops or real estate in a time of general decline.
In times of general unemployment, they can reduce labour costs and demand more from their workers, and with stable incomes and access to cheap loans, they can buy cheaper machinery and take over the transportation of sold-out vehicles.
The Great Recession shouldn't please anyone, unless it could prove to be a way to multiply the wire.
Wojciech Moszczyński — graduate of the Department of Econometrics and Statistics of Nicolaus Copernicus University in Toruń; specialist in econometrics, finance, data science, and management accounting. He specializes in the optimization of production and logistics processes. He conducts research in the area of the development and application of artificial intelligence. For years he has been engaged in the popularization of machine learning and data science in business environments.
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