What if you could forecast economic and market conditions precisely enough that businesses could use that data to make timely adjustments?
ITR Economics is the nation’s oldest privately held, continuously operating economic research and consulting firm. Since 1948, it has provided business leaders with economic information, insight, analysis and strategy.
Its overall forecast accuracy since 1985 is 94.7 percent at one year out.
“It’s been quite a fun run for us,” said president Alan Beaulieu, who has run the business with his brother, Brian, since the 1980s. “We have clients in virtually every industry, and there’s no country where we haven’t done some analysis. But family businesses are something I really enjoy, having been in one all my life.”
The firm’s own second generation includes his son and daughter and his brother’s two daughters.
And its forecasting has never been more critical as the firm predicts businesses have about six years to prepare before a potential decadelong depression.
Beaulieu will be among the featured speakers at the Prairie Family Business Association Annual Conference held April 27-28 in Sioux Falls.
What is ITR’s niche as a professional service?
We see the future, and we pass that information along to businesses in time for them to adjust their strategies and employ the proper tactics. We’re all about forecast accuracy. We’re all about allowing businesses to see what’s coming so they can prepare.
So is this a particularly challenging time to be trying to forecast economic conditions?
Yes and no. When you look at the reality of the market, it will be industry-dependent, but on a macro basis, we see the U.S. economy continuing to grow at a slowing rate that will level off this year, and 2024 will be kind of a flat year for GDP. For the industrial base, it will be a milder-than-normal recession ending in late 2024, so some family businesses will feel it, and some won’t. Retail sales will be slower growth, but they will still be there because the consumer is fundamentally in good condition.
For most businesses, there are there are things they can do to prepare. We spend a lot of time calming folks down. The world is not ending. Don’t focus on the politics. You need to use multiple sources of information. And let’s focus on your business so you can make rational decisions and not emotional reactions. If you’re looking at a slowdown, for instance, do due diligence on the credit-worthiness of your customers and suppliers –those types of things. So there are always things you can do.
In your book, “Prosperity in the Age of Decline,” you famously predicted a global great depression around the year 2030. Are you still expecting that, and what factors figure into it?
Our cyclical theories are known to just three people, but just last summer we refreshed all the numbers, and actually it’s more valid than ever. One factor is the demographics, the aging population. Baby boomers are a problem around the world, and keeping us alive and providing care is not going to be cheap. Governments continue to create their own problem accumulating debt and overspending, and it’s not just the U.S. And there’s going to be inflation problems throughout this decade on and off, ascending peaks and troughs, especially in the later years. In part, that’s what motivates us to make sure family businesses survive the great depression. There’s nothing you can do in 2029 to get ready.
How would you describe the focus of your keynote at the Prairie Family Business Association conference?
I’m going to present the economic reality as opposed to the hype so that businesses can adjust to a future with certainty. As a company, our accuracy record is what we stand on. For years, we’ve been getting this right, which hopefully gives people a reason to listen. I enjoy when folks come up after and say, “That’s refreshing, not emotional and something I can understand.” That’s what I strive for. We’re not politically motivated in any way.
As a family business yourself, what approach are you taking to your own planning?
In June of 2025, I’ll be off the road and in most ways out the door. I have other things I’ve yet to do in life, and I’ll be 69, so I feel like I’ve earned my exit. Our transition is occurring now, and we’ve been working the plan for several years, and it’s not just our family. We have senior management who are nonfamily, and we wanted to make sure this was a career-path company for people who are not family. Increasingly, our millennials get decision-making capabilities, and we offer comment and guidance when necessary. So we’re slowly handing over the reins so it’s not new to them, and when they get there, they’ll be very comfortable.
Is there some advice you share particularly for family businesses?
Think generationally, not in terms of four or five years, but in terms of how to prepare this company for generational activity. There are times you don’t want to plan for growth, but you want to prepare for the right level of activity going forward. My advice to people my age is to get out of the way. I firmly believe in it.
Alan Beaulieu will share much more insight at the 2023 Prairie Family Business Association Annual Conference. Click here for information and to register for in-person or virtual attendance.