Is the economy slowing down again?
Singapore 4th August 2011
From my recent travels in the region and the feedback received from clients and colleagues in the business it seems like the world economy is slowing down again. The debt crisis in the US, the problems with the Euro zone in Europe are not helping the situation and are probably at the root of all. Add to that the many scams and fraudes discovered in China and India (just to name two countries) and it somehow seems to affect the general mood in the market. Being a lighting designer (and not a financial analist at a bank) it is hard to pinpoint the cause and know what is really going on so we go by what we read and our gut feel about what is happening in the market. We have barely recovered from the 2008 economic meltdown so a new crisis is not really what we are looking for!
Why am I bringing this up? It is just that over the last few weeks I felt that clients were slowing down on their payments, taking much longer then usual in contract negotiations some of them not even responding to communiction. On top of that it seems like our fees are getting squeezed (see my pevious blog) to the last drop and even beyond. There are still heaps of projects seemingly in the pipeline and on last count we have close to a million dollars worth of fee proposals in serious negotiations but until you have a
signed contract and your first appointment fees in the bank it remains only an opportunity. Even a signed contract has proven in the past not to be a job (and cashflow) set in concrete!
And cashflow is what we need to run a business, as our overheads are guaranteed, month after month! The balance we need to find is the number of jobs we take on (if we have that luxury of choice) as we know that for every ten projects we taken on a likely 3 to 5 may die a premature death or be shelved at one point of time….we have to remain vigilant and not take anything for granted, that s for sure, certainly in the current economical climate.
In Light Watch today a peak into the latest ego-spending sky scraper development, the Jeddah Kingdom Tower, which was announced yesterday. Dwarfing the current highest buikding, the Burj Khalifa Tower in Dubai, this new development will reach 1km in height and will cost $1.2 Billion! It is part of the larger Kingdom City project that is billed at $20 billion! Guess nice if you get to do the lighting design, but do we need this?? Does it really make financial sense? Or is it just another ego project from some rich Saudi tycoon?
Light Watch 136: Jeddah Kingdom Tower (from www.skyscrapercity.com)