Boom-Time Blindness: Preparing for the Next Downturn While Business is Good
When demand is high and margins are strong, it’s the perfect time to get ready for leaner days.
Introduction
Earlier this summer, during a conversation with a respected voice in our industry, I learned something telling: while demand for ground transportation — especially in the bus sector — has largely returned to pre-COVID levels, capacity remains limited due to the consolidation that took place during the pandemic.
That puts many operators in a phase of strong performance, healthy margins, and steady growth. It’s a great place to be… and also the riskiest place to get complacent.
As former UMA President & CEO Vic Parra cautioned in a recent conversation, “demand is still outpacing supply (thanks to COVID!). But you and I know that at some point — in probably the not-too-distant future — that will change, and the equation will shift back to the pre-COVID days. Sales will slow, pricing will move back to the lowest-cost provider, and margins will drop.”
No one can say exactly when that change will come. This year alone, trade policy shifts under President Trump injected uncertainty into an already skittish market, creating a rough spring for stocks before they recovered. Yet trade deals remain unsettled, interest rates are stubbornly high, the job market is cooling, and many small businesses — the category to which most of us belong — are holding off on new investments.
History also reminds us that market turbulence often arrives quickly. Some of the darkest economic days in U.S. history — Black Tuesday in 1929, Black Monday in 1987, the dotcom low in 2002, and the start of the 2008 financial crisis — all came in the fall. But not every downturn waits for autumn. COVID disrupted the market in the spring of 2020 with little warning.
Economic cycles have always followed this truth, famously summarized by economist Herbert Stein:
“If something cannot go on forever, it will stop.”
Or, as Sam Walton reminded us:
“You can't just keep doing what works one time, because everything around you is always changing. To succeed, you have to stay out in front of that change.”
Strong demand and healthy margins may feel lasting, but history tells us they’re temporary by nature. That’s why the operators who take action now will be best positioned when the inevitable shift occurs.
Think of our industry in seasons: COVID was a harsh winter. Recovery brought the warmth of spring. Today, many are enjoying the abundance of summer. But just as the calendar turns, so does the business cycle. Autumn — and eventually winter — will return.
The smartest operators will use this “summer” to prepare now, so when the season changes, they’re ready.
Ten Steps to Future-Proof Your Bus Business Before the Cycle Turns
Good times create the illusion that the cycle has been broken — but history tells us otherwise. The question isn’t if conditions will change, but when. That’s why it’s critical to use today’s strength as a launch pad, not a resting place. The following ten steps are practical ways to prepare your business now, so you’re not caught off guard when the market inevitably shifts.
As Jim Collins wrote in Built to Last:
“The signature of a truly great company is not the absence of difficulty, but the ability to come back from difficult times even stronger than before.”
That mindset is exactly what this list is about — using today’s strong market as the launch pad for long-term resilience.
1. Strengthen and Stick to Your Budget — Even When the Numbers Look Great
When cash flow is strong, it’s tempting to let budgets slide. Resist the urge. A budget isn’t just for when times are tight — it’s your year-round financial game plan. Maintain approval thresholds for major expenditures to prevent recurring costs that may be difficult to reverse in the future. Treat every expense like you’ll have to justify it during leaner months.
