Dear Aunty B,
I work in the creative industries and two months ago our market went dead. My feeling is it’s not our business, it’s the market.
Is the worst over and do I ride this out or change direction? I am very under resourced so chasing other revenue streams is out of the question.
Not a lot of information Leon, but we’ll do our best.
Look, this is a time to hold your nerve but not stick your head in the sand, which is what you are doing.
SmartCompany’s editor James Thomson did a very good story on where we are in the cycle. History may well show us that last Friday was indeed the Black Friday of the 2008 meltdown.
Every financial crisis has its psychological “low.” Fingers crossed, we have had it. However the repercussions of this are still to be felt, not only in business but in the property market.
So while the worst may be over, the “worst” is yet to come. I think we will continue to jolt along in a downhill direction for at least a year before we start trending back up again. However if we are over the “low” point, some sectors of the economy will start to feel more confident and some dollars will begin to flow again.
So do what you have always done. Get out the business plan, get a big texta and go and begin drawing on your white board.
First thing; where you can get cash? Can you sublet your office space, sell any assets, retrench any staff? Second question; where can you get money? Equity, bank loan? Loan from a shareholder? What costs can you cut (remembering that great saying, don’t cut muscle, cut fat)?
Have a look at your IT area. Costs in some services such as web development and email delivery have fallen significantly, so see if you can negotiate better deals or get new providers.
Next is revenue. Get out there and sell. Look at cheaper forms of advertising such as online. Beef up your marketing. Chase some easy contracts and get them across the line. If you have other revenue streams, chase the most promising. Look at your most profitable customers and see if you can sell them anything more.
This is such a challenging time, so make sure you give yourself time to think! Where do you think best? On a walk? In the shower? On the treadmill? Plan for thinking time to figure out the best way forward. You’re creative and entrepreneurial; you can do it.
Your Aunty B.