More recently some corporations have modified this objective to include things like Google’s “do no harm” mantra, or not investing in country’s with human rights abuses such as TIAA-CREF or being environmentally friendly like Tesla Motors; but create and retain American jobs has not typically been a stated objective. This may however become one in our current political climate and that’s fine and may well become a marketing tool going forward.

Given the above, as a Fortune 500 executive, I was charged with maximizing corporate profits. I closed unprofitable plants typically in the high union labor markets in the US and relocated them elsewhere. In my case this included Latin America, the Caribbean, and nonunion towns in the Southeast. This made us the lowest cost producer and maximized our profit. We reduced our labor rates, had lower energy costs and taxes, free land, better work rules, incentives from politicians in the new location, etc. In some cases the existing factories I relocated were profitable, but we could make more money in another location.

I knew that not only was this my job, but if I didn’t do this, someone else would. I said on many occasions, that if I was prevented from moving by US law I would adhere to that, but absent that I did what I had to do. In addition most of the time, if we did not relocate, or were forced to remain where we were it was just a matter of time until those facilities would be shuddered and not only would no one have a job, but the company eventually would not survive.

To see all articles in this series please go to http://optimal-mgt.com/blog.

By now even if you were unaware of Brexit before, you now know. If you are a small to mid-sized company not doing any international business, the Brexit may not impact you and you could well be perfectly correct. You also may be wrong, and a sensible person explores the ramifications just in case they are wrong.

Let’s start with what we now know; and never panic. Most pollsters called this wrong; so much for experts. If you are a boutique company doing business locally, with customers also selling locally, you may be fairly well insulated from this event. However your investment portfolio and hence liquidity that you need to help finance your operations may have already gone down as when there is uncertainly markets decline. On the sales side, even if you are a smallish local company, your client may be doing a fair amount of business (directly or indirectly) with foreign companies and US operations you service may have foreign ownership.

Having said that, what could happen if you have even some indirect sales exposure? Your goods will cost relatively more even if they are just a component to the European/UK end market customer and any other dollar denominated product such as oil, due to the increase value of the US$ . As noted, uncertainty is bad, people may cut back on buying goods and services “just because”. One more point, be prepared for opportunities (as well as risk) due to distressed situations. There may be black swan deals out there that we can’t predict, but once they happen be prepared to jump on them: great new applicants, distressed sales, business opportunities, etc. The answers are all the same: stay close to events and your customer and be prepared to act swiftly if needed.

To see all articles in this series please go to http://optimal-mgt.com/blog.