The Credit Crunch in 3D
The Credit Crunch is affecting both small and big businesses, with 3D Design companies in the middle trying to fight their way through these hard times. However, there are those who are surviving the recession due to their innovation and a common sense attitude. Here we’ll list a number of guidelines that business experts recommend for surviving an economic turndown if you’re involved in the market of 3D Design.
Design companies don’t get the immediate benefits that other companies do, since firms tend to sit back and wait for a recession to pass before investing in what 3D Design companies can offer. The advice 3D firms should be telling their clients is that flexibility is the key to their firm’s longevity. It is the role of the design company to instil confidence in these firms, and to convince them that their investment in design services will add value to their business as well as reduce their outlay in these difficult and penny-pinching times.
Cutting overheads is another way of reducing the financial pressure. Fly economy class, plan one-day trips to reduce hotel costs, and use the Web and teleconferencing to reduce trips. Consider alternatives to lay-offs, such as voluntary days off without pay, especially in summer, salary reduction starting at the top, trickling down as necessary, and four-day weeks. The question currently facing owners of design firms is whether they are better off having no staff at all, drawing upon freelance talent instead.
Having full time staff can be a drain on resources when the hard times hit, so many are looking into employing freelancers to see them through the difficult times. During a downturn, this approach has many benefits, your company can market the collective skills and experience without bearing the salary costs of inactive people. This also means you don’t need large offices. However, if you are going to cost cut, bear in mind that you cannot afford to be frugal when it comes to technology. Always invest in the best and most advanced hardware and software. This itself saves money, and allows the firm to occupy a leading market position. So instead of drawing upon the often limited skill sets of junior employees, experienced freelance specialists can bring a lot more value to a business as well as reduce the overheads of the company.
Another thing to consider is that a downturn in the market presents an opportunity for your firm to use the spare time you will have sharpening your marketing material and Web site. In addition it will ensure you can respond fast to any new enquiry with considered replies, backed up with good, standard documents. Also, keep focused on what clients actually need, rather than what you want to sell them.
Constant invention is something that 3D Design companies are being urged to focus on as they seek out new business opportunities and partnerships. It is believed that a constant reviewing and testing of what you do is a way of surviving your financial restrictions. But the key to success for surviving the credit crunch for design companies is when a dip in demand hits and, just as importantly, how to structure the work with an eye on the long term, so that future market fluctuations do not affect you. The area of concern for successful 3D Design companies is when the average fee-spend for projects begins to drop, followed by the number of enquiries for new projects, and added to this the increased competition from other marketing communications sectors, who are all digital now. However, you would do well to remember that firms that succeed in a difficult economy all offer strongly differentiated perspectives, capabilities, and proprietary knowledge that clients want to buy.
Fatwax 3D Design have approached their business with a strategy of increasing their competitive advantages, developing a flexible workforce that responds to changing situations, maintaining a passion for doing important work and sticking to their guns on pricing, it is more likely that they will survive the financial downturn. During the recession it’s important for design firms to get pricing right. Do not lower prices. Value your work or your clients won’t. Also, avoid clients that ask for a free creative concept phase during the selection process. Clearly and fairly describe the scope of work, and charge accordingly.
Dropping your fee levels merely devalues your business and design in general. It’s better to stand your ground, and state what you would like to do and what it will cost. Also, never carry out speculative design work, but be prepared to meet, discuss and send out intelligent proposals of suggested work stages and fees. When it comes to costing, it should always be about effectiveness. In a downturn, clients tend to think of design as a cost and not an investment. They want you to reduce your costs, and many would agree that this is a fair request, because the client wants to make sure their investment in the design firm is cost-effective.
There’s always going to be work for 3D designers but the trick is to remain relevant. If your work is relevant to your market then you’re going to be in demand. Having as diverse a client base as possible also goes a long way to surviving the down turn. Sending informal emails to existing clients and showing a few new samples helps to keep your work fresh in their minds, making sure you will be the first they call on when they feel confident about returning to invest in your services.
Although the credit crunch is undoubtedly bad news for a lot of people, many experienced designers are welcoming the downturn as a chance to finally take a hard-earned break. So, whatever happens, you might get an extra holiday out of the crisis!
