Economy Affecting Our Industry?

[RyanSpaulding]

Ah, I think it's fair to offer your opinion on Dubai. I've heard elsewhere that Dubai is looked upon this way...just wanted better clarification.

 

I'm envious of those working arch viz in Australia and much of Europe. Market seems ok over there...more peaceful nations as well.

[EddieLeon]

My advice would be to not start until payment even if you do have a very good relationship.

I agree, but some of the larger clients with long accounting cycles will find that to be troublesome. The trick is to be cautious and clear about payment expectations. If a client is late in paying the retainer then you might expect problems in the end.

 

Regarding the economy and our industry, my gut feeling is that it's going to get worse and stay that way for a while.

[Scott Schroeder]

It's a tough market everywhere, but I have to admit a lot of the state of the building industry is our own fault, at least in the US. The developers and banks were so greedy and the money was so fast, that they built so many homes so fast and charged way over the cost. Banks were willing to give out high risk loans, because at the time if the home owner defaulted, the bank could actually sell the home in a few weeks and make a profit on it. Look at Las Vegas as an example, it went from the hottest housing market to the worse market in less than 2 years. I read that there are something like 22,000 unsold homes (51% of those are vacant homes) in the greater Las Vegas area. But what did we expect when we saw home prices raise by 8-fold in a matter of 4-5 years?

 

Human greed had a large role in this current housing slump (at least in my mind), just like the whole Enron debacle a few years back. But the truly sad thing is, we won't learn from his. I bet 10-15 years from now, if we are still in the industry, we'll be looking at a similar skyrocket then plummet back to earth. We'll all be standing around scratching our heads going, "Hmm we've never seen this before."

 

All though, one nice unexpected out come of this is that I'm seeing more and more European CG jobs coming over to US firms thanks to the weaker US dollar. Right now, the US is Europe's China.

[EddieLeon]

It's a tough market everywhere, but I have to admit a lot of the state of the building industry is our own fault, at least in the US.

 

Very good point. Many of us relied on a messed up industry. The lesson for me has been to not rely on housing or any specific market or industry. Globalize and diversify is my mantra

[Sawyer]

Its all greed that brought this on and my fear is that right now we are on the tip of a bad downward cycle thats still got a long way to go before it finds bottom.

 

Right now we are weeding out bad mortgages most by people who couldn't pay. What about the people who can pay but now have a worthless mortgage? They bought at the peak their mortgage is $600,000. They can pay it but they put 40% down and now their house price has dropped 50% in value so their neighbor bought the exact same house last month for $300,000. The first family can pay their bills but why would they? They can walk away rebuild their credit and in a handful or years buy their same house back at maybe $400,000.

 

This is a story by some people I know and the only solution they see right now is to walk away. I know its not usual to put 40% down. I don't know if they will walk but this is what the next trend will be, people choosing to walk and rebuild their credit and the credit industry will be hit really bad.

 

Problem is does anyone know what the number 1 product the US economy makes?

 

 

DEBT.

[Eezo]

Ok let me ask you guys this. Just imagine if you woke up tomorrow and everything was 10 times worse than it is now and there was no chance of you getting any work at all in archi vis, what would you do?

 

EddieLeon you said you have decided to Globalize and diversify, how exactly have you changed what you do?

 

I personaly do a bit of web design on the side and its something im thiking of getting into a bit more seriously.

[whitetr]

The bulk of the work at the company I work for is AEC related. We don't do a bunch of archi-viz. While the average people are feeling the pinch of a weak economy, the governments are still spending at full speed...they are updating infrastructure and we reap those benifits. If you had to fall back on something, take a look into AEC. If that went to crap, I guess I'd fall back on the electronics background I have...and hate:)

[EddieLeon]

EddieLeon you said you have decided to Globalize and diversify, how exactly have you changed what you do?

 

I have tried going to many different trade shows and placed ads in many magazines and websites. But, I have found that the best and easiest way to Globalize is to target large regional clients that have global operations. Let them be the ones to get the jobs in Dubai, China, Russia, and wherever.... It would be too expensive for you to market directly to clients in other areas. It would also be too difficult to manage the overseas relationships properly.

 

Web design is a good option for diversifying services, but that might take you beyond your core competence and distract you from your 3d. Another option is to market your services to the web design companies that need 3d assistance. There are a lot of interactive agencies that need help building sites with 3d environments. We did one called GeicoGarage.com. All we did was the 3d and video compositing. The interface and coding was done by someone else.

 

Keep in mind, diversifying is good, but it takes time to build the leads and get the work. So, limit the amount of time you spend doing it and keep doing your "bread and butter" work. Good luck!

[EddieLeon]

The bulk of the work at the company I work for is AEC related. We don't do a bunch of archi-viz. While the average people are feeling the pinch of a weak economy, the governments are still spending at full speed...they are updating infrastructure and we reap those benifits. If you had to fall back on something, take a look into AEC. If that went to crap, I guess I'd fall back on the electronics background I have...and hate:)

 

That's a good point. In fact, governments spend more on public works projects during recessions to help create jobs and boost the economy. Health Care also continues to do well because it's a necessity.

 

By the way, working at an in-house studio at a large firm like PB is a pretty well insulated position to be in. They can probably give you more work than you can handle because they can just add your work as a line-item into the big public works projects. However, some in-house studios at smaller firms might feel the pinch as the poorly leveraged firms begin to downsize.

 

 

PS - Arch Viz is a part of AEC (Architecture, Engineering, & Construction). I guess your focus might be the E&C.

[Antisthenes]

i haven't read anything above yet but i would say it is as we get more work and clients in the downturn because they realize this is the best time to build if you have money. build critical facilities that is like hospitals, grocers, pharmacies, restaurants, and the like.

 

plus usaians are cheap exploitable labor now with the dollar fall and inflation.

[Scott Schroeder]

For me if I had to leave the arch-viz, I'd go into public service. Probably firefighter, since my brother is a firefighter and all the time through college I was a volunteer firefighter. You have to figure that public service jobs are fairly secure, I mean the pubic needs to be taken care of.

 

I had thought about web design as well, but there lies a problem with that. The problem is that now days, any high school kid can use Flash and design websites. Does that make the designs good? Certainly not, but why should some company pay me what I require to live if they can just pay some high school kid 6 bucks an hour and get the basic same result? However, if you can find that rare job in web design, you can make a total killing.

 

Or I can come up with an idea and sell it on late night infomercials. That's plan C.

[Ky Lane]

Or I can come up with an idea and sell it on late night infomercials. That's plan C.

 

We could team up and develop a "Photorealistic award winning render button" for 3Ds Max, sell it on Gunthy Renker (late night infocrapercials in Aussie) and make a killing to the kids with pirated copies of max and huge rice cooker car debts?

 

Yeah, Im having one of those days too.

[Justin Hunt]

But Wait Therse More, with 100 easy payments of $500 an week we will also thow in this set of steak knives.

 

jhv