Thursday, May 21, 2020


A businessman seeking government support for dealing with the coronavirus made the following statement on television.

We just want certainty!!
I suspect that he does not understand the basic reality that faces all businesses, in fact the whole of life, and that is uncertainty. All businesses face uncertainty all of the time.

When a new business starts, its success is uncertain. Even if it has a really good product, the behaviour of consumers is uncertain. They might choose to stick with their existing suppliers, even if their products or service is not as good. Competitors might undercut the new businesses with a cheaper price. There are dozens of other things that could go wrong. Even if the manager/owner has planned for all possible eventualities, things could happen that they have not planned for.

Existing businesses also face uncertainty. Even if a business had a good year last year, there is no guarantee that it will be successful in the next year. Customers might switch to different suppliers with different products. Competitors might find a source for a product that is cheaper and better. Other unforeseen events could cause problems for the business.

A business owner or manager that expects certainty is dreaming. Successful businesses are those that can adapt and respond to uncertainty. Profit is a reward for dealing with the uncertainties of life effectively.

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