Wednesday, May 14, 2008

Testing the business temperature

I'm researching an article at the moment asking economists if they believe we're heading for recession in the UK. So far, the view is rocky times, but probably not a recession which is a specific economic term meaning two consecutive quarters of negative growth. However the sample is pretty small at the moment.
It has made me think about how recession-proof my business is, since comms is often an easy target when companies look to cut back on costs.

So far, the signs for Leapfrog aren't bad. Financially, this is set to be our best year since 2004/2005 and the core client base is holding up. It actually seems that comms teams are taking the brunt in-house - teams are contracting, and those within them are being asked to do more. The result so far is that I'm actually being asked to do more too, to pick up the inevitable overload, although it's more day-to-day practical stuff with less high-powered (but high value) consultancy.

My take is that there are fewer big coms and change projects starting, but core communications within most organisations and with their external stakeholders have largely remained unaffected. That means more being asked of over-stretched in-house teams, with the result being more pickings for micro-businesses like mine who can come in, get the job done without fuss and get out without affecting the headcount or denting the budget too much.
What is happening is more haggling over costs, and longer gaps from invoice to payment - and neither's great when you're at the end of the food chain.

However, I've decided to stop taking on third-party generated consultancy work. That's the stuff where I go out to the end client as a representative or associate of another comms business. It's something I've done from time to time over the last eight years for three or four consultancies, but my experience is that while the pay may be good, the work is often less satisfactory, and there's an additional level of stress involved in being beholden not just to the end client, but to the consultancy too.

I simply operate better on a direct basis, and while I might well regret the loss of the occasional injection of cash that such projects bring, I'm slowly trying to change the way I work - and this is a necessary step.

By contrast, I'm actively pushing for more tactical work via agencies - a piece came in this morning, and I'm talking to a publisher about another. It's the kind of work that can be done relatively easily, with strict deadlines and something tangible at the end.

As economic times get tougher, there's likely to be little security in the kind of work I do, but I'm banking on being able to continue the tangibles of writing, whether it be scripts, magazines or whatever, rather than relying on the intangibles of consultancy - which has a habit of getting pulled at short notice when the going gets tough.

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