Double dip 2009

Well here we go again. Christmas is coming and, yes, given market reactions and the news that Dubai’s bubble has burst, it looks likely that we are heading for the classic W – two falls into recession, a double dip. Of course, like you, I hope it won’t come to that but optimism does seem to have evaporated.
Pressure also seems to be mounting in Soho with companies steadily falling behind their targets. October and November should be good months in anyone’s books but it seems they were not good enough for everyone to build up the cash reserves needed to last through the bleak mid winter. Yes, cash is still king and the businesses that will survive are those that have amassed what they need for the coming months. Realistically, in this market, that means expecting business to be 25 per cent worse than anticipated. If you can cover that, then kick off your shoes and enjoy the festive season.
Last year’s resolutions assessed
This time last year I thought we were at the bottom of the recession and detailed my optimistic views for 2009. Let’s see if they made any difference.
VAT was cut by 2.5 per cent. Well, by any standards, it made little impact on the market and, yes, it goes back up to 17.5 per cent on 1st January. Verdict: this one failed.
Banks were told to lend to businesses yet credit seems more difficult to procure than 12 months ago. Verdict: another failure.
Channel 5 will merge with Channel 4 to make a more commercially sound outfit. The companies haven’t merged and both are in perilous positions. Verdict: the option remains.
Bernard Madoff didn’t run off with the entire world’s remaining wealth. Verdict: true – but Allen Stanford followed pretty quickly with another Ponzi scam. Verdict: if something seems to be too good to be true, it probably is.
We have a new US president, and one who had ventured outside the US before being inaugurated. Yes indeed, Barak Obama is now in the White House but commentators have said he has completed precious little in his first year. Verdict: the hope remains.
The UK is going to pull all its forces out of IRAQ. Verdict: great – but the death toll in Afghanistan has risen steadily through the year, counterbalancing any perceived benefit from withdrawing from Iraq.
Twelve wishes … fulfilled?
At the same time I made my 12 wishes for Christmas:
12 weeks of confirmed editing at a rate which made us money
11 days of shooting where the client also took my kit
10 new series commissioned by the BBC
9 weeks without a company going into receivership
8 weeks of TV ratings without reality shows
7 days to pay or else the letter from the Revenue was a mistake
6 American blockbusters all made at Pinewood
5 years of stable formats with no need to upgrade equipment
4 successive interest rate cuts passed on to the customer by the banks
3 Indian companies bought up the whole of Soho for top money
2 customers paid on time ...
a partridge in a pear tree.
How did I do with those? I think I did get the partridge and I believe three Indian companies bought into Soho – but at relatively bottom money. Of the remainder … they still seem a far cry away.
Surviving 2010
So what should we do over the next few months to keep the wolves from the door – or at least to avoid them blowing our house down?
Well, as I’ve often said before, it helps if the business has good foundations. Businesses that are built on solid principles are more often the ones that survive. Businesses that meet regularly and have a plan, however basic that plan is, also have a better chance of survival.
Look at your business and do two things: be honest with yourself about its state and chances, and don’t be scared to ask for advice or help from experienced people outside your company. Some of my most rewarding times at work are when I am sitting in with other companies, listening to how they work and operate and, at the same time, offering words of advice on how they could perhaps improve on their model.
Business isn’t, as the clich goes, rocket science but nor is it something that can be guaranteed to succeed just because you are 100 per cent committed to it. It helps to talk to other people as they may well have a different slant or level of involvement, either of which can bring valuable insights that lead to important shifts and adjustments. You may, for example, find that moving the direction of your business ever so slightly makes an enormous difference. Or you might see opportunities – even opportunities that were staring you in the face but which you hadn’t grasped – to add extra income to your business. And, at times like these, every extra bit of income helps.
Do something different to clear your mind
Last, but not least, try to take some time off this festive season to enjoy something else. Exercise is a proven way of reducing stress – and could help work off the extra pounds you are likely to gain during the next month. But if exercise is not your thing, then at least do something completely different to take your mind off work. It doesn’t have to be expensive; you could take advantage of everything that is free and which you’ve been meaning to do for years (including visiting what millions of us keep promising ourselves we’ll do – go to whatever is just round the corner). The break and a clear mind will help you get through the bleak months of January and February – whether that bleakness is the state of our industry or the dull, damp, dreary new year weather.
Happy festive season and best wishes for the New Year. You may need it … a cold storm is brewing.

Tags: azule | finance | business | iss036 | double dip | vat | N/A
Contributing Author N/A

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