It is no surprise that your company’s performance is influenced by external global forces. Changes in oil prices, unexpected droughts, or changing consumer spending can alter a product’s demand, availability, or production costs. For decades, business leaders have believed that such global data cannot be predicted accurately or with enough lead time to make meaningful plans. We at Prevedere know otherwise.
Understand how the world impacts your business
Global data including economic changes can be predicted with a high degree of accuracy and with lead times as far out as 24 months. While every company is uniquely impacted by external factors, below are macro-economic indicators that impact nearly every industry in a cyclical manner.
Real Average Hourly Earnings
Simply put, this indicator measures if we’re making more or less money over time. If our pay is increasing faster than inflation, it means we have more money to spend.
If we’re making more money and feel confident about our income situation, we’ll start spending more on things like large appliances, cars, homes, or finally take that vacation to the beach.
As we spend and consume more, companies need to start producing more. You’ll see factory output increase to restock stores with TVs, clothes, or furniture.
If we’re spending more, and factories are making more – that usually means companies start becoming more profitable. Public companies will start reporting higher profit margins in quarterly reports.
After 6-12 months of consistent profits, companies will start feeling confident to spend money to grow. This could mean buying more delivery trucks, expanding a plant, or launching new products.
The Cycle Continues
Once companies start investing in growth, a natural outcome is more jobs. Interest rates rise as there is more demand for loans (for houses or cars). In a steadily growing economy, prices for things rise as companies realize we can afford more.
What exactly is global data?
Prevedere has developed proprietary systems, hundreds of APIs that connect to thousands of global data sources that collect, scrub, validate, and organize millions of data sets. These updates occur daily so you can be sure you have the latest information. But what kind of data do we collect? Here is a brief list.