What's Going On With Business At The Moment?

[Sheer Heart Attack]

I've never seen anything like this September and October, and I've been running an advertising company for the best part of decade now.

In advertising (small-scale stuff), September to mid-December and mid-January to late May are when we make our money. We expect to lose money in the other months, but that's just business.

It feels like everyone seems to have forgotten that they have to buy and sell things to make money.

Our trade is 50% down on this time last year - and we're an advertising company! I've had lots of concerned customers wondering what the hell is going on - a couple of them nearly in tears because some of them are taking even bigger hits than we are.

We have two main areas of trade - one is 30% down on this time last year and one is 75% down. We're doing all the same things we've done for years.

To anyone else who runs a smaller business or works in a smaller business, is it very quiet for you this year for some reason?

What effect the Northern Rock, the credit crunch and the housing market?

[madasafrog]

We are currently very busy but our industry is engineering and manufacturing. Anything that happens in the economy usually takes some time to filter down to us.

I have heard other people saying that things are slow. Other parts of engineering have slowed and there are companies that are closing on a weekly basis.

For your trade, I guess its just a point of confidence. Business's may nervous and are just holding back on spending. Once confidence returns, they will be back on the phone to you.

[Grommit]

To anyone else who runs a smaller business or works in a smaller business, is it very quiet for you this year for some reason?

We are quiet too (direct mail/internet retailer). Saw this coming about 6 months ago, so we are staying quite lean and mean. Lots of grim news out there which is probably only just hitting the consciousness of the sheeple.

On a more positive note, Mrs Grommit suggested to the EA yesterday that we pay £750k for an £880k house. They called back this morning and told us they are thinking seriously about it! This is a massive sentiment change as far as I am concerned. Lots of stuff is now stuck and not going anywhere quickly, the occasional test will show where the market currently is.

[Sheer Heart Attack]

It's definitely strange.

I'm pleased that your place is doing well, madasafrog - I hope it continues.

Grommit, you've got the right idea. Unfortunately, I wasn't that far sighted. We've just signed up to a minimum 3 year lease at really nice offices and our staff bill is high.

In previous years, we NEVER had to do any outbound calling to get business. Our reputation (which we really worked at) and the wonder of Google Adwords returned money in spades. There was more than enough for the seven of us to do.

The staff are understandably upset that they're doing outbound calling now and not just fielding calls from interested customers (which they converted brilliantly).

In our busy times, we should make £15,000 a month. We lost £6,000 last month and will probably break even this (touchwood) but everyone is working like buggery to do it.

They do say advertising is one of the most adversely effected industries in a recession. Please God don't let us be a bellweather for it.

[Guest The_Oldie]

Very Quiet (Industrial Electronics). Everyone I speak to in the industry says the same.

Fortunately, I saw it coming and have cut overheads to the bone and am sub-contracting all manufacturing.

I shall probably shut up shop and retire next year.

The last three years have been very busy though, so I'm not complaining .

[lufc]

I've never seen anything like this September and October, and I've been running an advertising company for the best part of decade now.

In advertising (small-scale stuff), September to mid-December and mid-January to late May are when we make our money. We expect to lose money in the other months, but that's just business.

It feels like everyone seems to have forgotten that they have to buy and sell things to make money.

Our trade is 50% down on this time last year - and we're an advertising company! I've had lots of concerned customers wondering what the hell is going on - a couple of them nearly in tears because some of them are taking even bigger hits than we are.

We have two main areas of trade - one is 30% down on this time last year and one is 75% down. We're doing all the same things we've done for years.

To anyone else who runs a smaller business or works in a smaller business, is it very quiet for you this year for some reason?

What effect the Northern Rock, the credit crunch and the housing market?

Sorry to hear that.

If I were you I'd write to the Prime Minister ... he seems to know what he's talking about ... no Boom to Bust on his watch !!

[wickywackywoo]

I've never seen anything like this September and October, and I've been running an advertising company for the best part of decade now.

In advertising (small-scale stuff), September to mid-December and mid-January to late May are when we make our money. We expect to lose money in the other months, but that's just business.

It feels like everyone seems to have forgotten that they have to buy and sell things to make money.

Our trade is 50% down on this time last year - and we're an advertising company! I've had lots of concerned customers wondering what the hell is going on - a couple of them nearly in tears because some of them are taking even bigger hits than we are.

We have two main areas of trade - one is 30% down on this time last year and one is 75% down. We're doing all the same things we've done for years.

To anyone else who runs a smaller business or works in a smaller business, is it very quiet for you this year for some reason?

What effect the Northern Rock, the credit crunch and the housing market?

I don't think it's anything specific to your business, it's simply a recession getting started.

[lordofcolchester]

We are quiet too (direct mail/internet retailer). Saw this coming about 6 months ago, so we are staying quite lean and mean. Lots of grim news out there which is probably only just hitting the consciousness of the sheeple.

On a more positive note, Mrs Grommit suggested to the EA yesterday that we pay £750k for an £880k house. They called back this morning and told us they are thinking seriously about it! This is a massive sentiment change as far as I am concerned. Lots of stuff is now stuck and not going anywhere quickly, the occasional test will show where the market currently is.

Things can't be that bad if you can afford to splash 3/4 million on a house. How the other half live!

[?...!]

The problem is an economically technical one.

Following the vast number of Americans defaulting on their mortgage, demand for securities plunged and there remains a huge oversupply of unsold securities in the global market.

This revelation probably means nothing to most people, but basically whilst this very large backlog of huge unsold debt instruments remains, there is very little motive for lenders to extend credit to the consumer.

Basically you are in for a bit of a rough spell as long as this backlog exists. And for your information rather than the backlog being worked off, the backlog is actually extending at the moment.

Global capital is demanding higher interest rates. And if interest rates do not go up credit will not be forthcoming.

In february the risk/gain scales finally tipped back and money is now flowing back to the great capital reserves.

Unfortunately as an advertiser I would expect you to be one of the first hit.

[yaakov]

I've heard people I know say its very quite in their accounting firm (one of the big three or however many there are) and someone else say its very slow in their engineering firm (not so big but does lots of research for some very big companies)

[DabHand]

I don't think it's anything specific to your business, it's simply a recession getting started.

Have to agree. Advertising revenue is quite a good canary despite the logic that you have to advertise to sell.

Consider that recessions like booms are self feeding, that'll be that old known unknown: sentiment.

[caution]

Mixed sentiments at the moment, I run a small UK Scientific & Electronics manufacturing Co in North Yorks, Engineering & Environmental customers are busy for a change, better outlook than last year. I did wonder if we would see things turn for the worst like Sept/Oct 01 after 911, everybody trimmed capital spending for a while - remember?

Off the thread the Harrogate & district market seems to have ground to a halt! Advertise it 20% under the usual inflated & over-rated value for these parts and it seems they will still sell, FTB still moving a bit, 300-400k sticking. Odd few btl chumps still alive ( I think), odd few idiots have still popped up with a few surprise purchases though!

[right_freds_dead]

two of our competitors went bust. dont know why, but it was big sudden news to us.

we are doing ok. its always very quiet sept-oct anyway so its hard to tell.

i can say the average spend has been down for a few months but not the customer volumes. people are getting very price orientated. i also cut down lean and mean in july when people started penny pinching, but i do have a lot of stock which should be gone by january.

after that ill be very careful with new stock orders for 08.

[madasafrog]

It's definitely strange.

I'm pleased that your place is doing well, madasafrog - I hope it continues.

Grommit, you've got the right idea. Unfortunately, I wasn't that far sighted. We've just signed up to a minimum 3 year lease at really nice offices and our staff bill is high.

In previous years, we NEVER had to do any outbound calling to get business. Our reputation (which we really worked at) and the wonder of Google Adwords returned money in spades. There was more than enough for the seven of us to do.

The staff are understandably upset that they're doing outbound calling now and not just fielding calls from interested customers (which they converted brilliantly).

In our busy times, we should make £15,000 a month. We lost £6,000 last month and will probably break even this (touchwood) but everyone is working like buggery to do it.

They do say advertising is one of the most adversely effected industries in a recession. Please God don't let us be a bellweather for it.

Last year was a mare for us though. We have had some rough times in the past and have to refocus the business to stay alive. It has also made the business leaner and keener. Dont be worried about the staff being annoyed at having to do cold calling. Really a case of option A - Do cold calling and keep afloat or Option B. No cold call, no business and everyone loses.

I dont want to be pessimistic but if it comes to it, dont be afraid to cut the wage bill to keep it afloat. Its sad to lose a member of staff but its sadder to lose them all later. I am sure with a bit of support they will understand this and will pull together to keep heads above water.

Keep at it

[bobthe~]

Well business is fine for me and I have no worries.

I am a provider of IT services (contractor) to the financial services industry and that is rock solid!

Seriously, things are OK at the moment, but I am expecting it to go horribly wrong next year. Just battening down the hatches, and making sure I keep up with my network of friends in the industry. Trouble is most of them are working for sub prime mortgage companies at the moment. Ooo-er

[Sheer Heart Attack]

Last year was a mare for us though. We have had some rough times in the past and have to refocus the business to stay alive. It has also made the business leaner and keener. Dont be worried about the staff being annoyed at having to do cold calling. Really a case of option A - Do cold calling and keep afloat or Option B. No cold call, no business and everyone loses.

I dont want to be pessimistic but if it comes to it, dont be afraid to cut the wage bill to keep it afloat. Its sad to lose a member of staff but its sadder to lose them all later. I am sure with a bit of support they will understand this and will pull together to keep heads above water.

Keep at it

Thanks for your advice, madasafrog, and everyone who has contributed so far.

It does seem to be endemic at the moment. We've used a very good telephone answering firm to take some of our sales calls for the last four-and-a-half years and they say the call volume for the 300-odd businesses they handle are down about 50% too.

We've had some very rough times in the past (more down to my mismanagement of the business at certain points than anything else), but nearly going under 3 years ago sorted my brain out and I became far more focused. We saved up a stack of cash in the busy times, but we've had to dip into it over the last 4 months and it's gone down 40% in value (a lot of that down due to the sheer cost of moving but now we're dipping into it for everyday cashflow).

right_freds_dead - I know what you mean. One of our competitors, been around for as long as we have, went under and sold itself to another competitor in the last couple of weeks.

There's also a real price war going on too. Our customer numbers are down on this time last year and average customer order is about half of what it was last year.

Mr Rose, thanks for the link - that is worrying. Our VAT bill is normally around £18,000 a quarter - the last quarter was £2,500 due to much reduced turnover and moving costs. We insist our customers pay up front so we don't really have that much of a problem with that, fortunately.

Let's all keep at it - it's tough enough being in business. It's very scary actually - we have found a way of making our business produce consistent and high profits, but there's price competition, wary customers and fear around now.

[Guest The_Oldie]

Last year was a mare for us though. We have had some rough times in the past and have to refocus the business to stay alive. It has also made the business leaner and keener. Dont be worried about the staff being annoyed at having to do cold calling. Really a case of option A - Do cold calling and keep afloat or Option B. No cold call, no business and everyone loses.

I dont want to be pessimistic but if it comes to it, dont be afraid to cut the wage bill to keep it afloat. Its sad to lose a member of staff but its sadder to lose them all later. I am sure with a bit of support they will understand this and will pull together to keep heads above water.

Keep at it

That's all you can do really, as some competitors go to the wall things will improve a bit. I've been through three recessions in my business life and am not going to bother to slog through another. I was going to retire three or four years ago, but decided to keep at it until the economy turned, which looks like about now.

[right_freds_dead]

Let's all keep at it - it's tough enough being in business. It's very scary actually - we have found a way of making our business produce consistent and high profits, but there's price competition, wary customers and fear around now.

tough times are a great opportunity.

people will ALWAYS require product X, Y or Z

they dont STOP buying x,y,z. they just want to pay the best price for it.

you have to make sure your the leanest, best value, fastest and most efficient operator in your market.

i geared up by buying cheaper bulk stock with bigger margins. if theres a down turn no competitor can lower prices like i could.

im ready for this and if i have to do it for £1 and survive i will,

ill do it for £1 because they cant and they will be gone - which is as good as profit. selling for low or next to no margin is an investment in killing off competition.

i also lowered overheads to the bone.

im ready for this...

[BoomBoom]

Last year was a mare for us though. We have had some rough times in the past and have to refocus the business to stay alive. It has also made the business leaner and keener. Dont be worried about the staff being annoyed at having to do cold calling. Really a case of option A - Do cold calling and keep afloat or Option B. No cold call, no business and everyone loses.

I dont want to be pessimistic but if it comes to it, dont be afraid to cut the wage bill to keep it afloat. Its sad to lose a member of staff but its sadder to lose them all later. I am sure with a bit of support they will understand this and will pull together to keep heads above water.

Keep at it

Fingers crossed your business goes under, you fall into a deep depression and hit the bottle heavily, finally departing the realm of the corporeal by throwing yourself under a bus.

[Injin]

Fingers crossed your business goes under, you fall into a deep depression and hit the bottle heavily, finally departing the realm of the corporeal by throwing yourself under a bus.

I see a market for booze and public transport in this statement, not to mention happy pills and therapy for envy issues.

[right_freds_dead]

and bull bars for buses. i see a new business idea making 'suicide bars' for cars and trucks.

[Fergie]

I've noticed pubs have been empty the last couple of times I've been out - once in Edinburgh, once in Dundee. Both are student towns, and the students have just come back, so you'd expect the bars to be brimming, but no...even the cheap ones with student deals were dead. In one super-pub, there was no one at all except for an old couple sitting doing a crossword puzzle

It's like everyone's just disappeared all of a sudden.

Edited October 12, 2007 by Fergie

[BoomBoom]

I see a market for booze and public transport in this statement, not to mention happy pills and therapy for envy issues.

Don't confuse envy with contempt.

[godless]

Even though I'm only in the early stages of my business proper its doing very well atm but I'm in the precious metals trade so you can understand why Its been a long and tough 10 year journey to get where I am today but I think the rewards are coming and with no debts and low overheads, business premises and taxes are my only problems at the moment, but hopefully its going the right way for me with the property market

[AC2]

I run a long-established web publishing company, and while traffic is rising predictably, revenue is lower than usual for this time of year. Might be a blip, might be something more. I survived the dot-com mess so I'm not too concerned, but there do seem to be some warning bells sounding.