Arch Viz Industry Index

[EddieLeon]

We have been having an excellent discussion about our industry and the economy on another thread. Jeff Mottle introduced the idea of creating an industry index that would chart the performance of our industry. This index would help to clarify our understanding of our young industry and help alleviate any fears that anyone might have about it's future.

 

This index can be created very easily without compromising anyone's confidential business information. All we will need to do is track a percentage of change in sales for each month. We can then gather everyone's info and place it as a chart of average sales performance on CGA. Let's start with January 2008. Anyone can participate regardless of company size or location.

 

Before we begin, let's all agree on the rules. Here's a few that I can think of:

 

1 - Data - What exact info do we want to collect? A single positive or negative number that is a percentage difference from the previous month's sales? Do we want to track cities, countries, project/client types, or just overall sales?

 

2 - Data Gathering - How do we collect the data? Online form or email? Who receives it? This must be a neutral person. I will nominate Jeff, but I don't want to impose more work on him

 

3 - Participants - Who and how many freelancers/studios want to participate? This can be done confidentially. Once we agree on who will collect the data everyone can then contact that person in private. Also, anyone that participates needs to make a commitment to provide the data on a regular basis. Otherwise, the index will not be accurate...

 

And now to make things interesting and show good faith, I am attaching my sales chart for 2008 (This also includes all change orders). Once we can all agree on the parameters of the index, I encourage everyone to participate.

 

[EddieLeon]

Here are my percentages:

 

Jan: 0%

Feb: -15.11%

Mar: -7.59%

Apr: 77.65%

May: -42.85%

Jun: 6.81%

Jul: 15.93%

Aug: 7.62%

Edited September 11, 2008 by EddieLeon
typo

[dinhtuan]

I interested in this idea. How do you calculate that persentages? Sales value base on the contract per month or money we get paid?

[EddieLeon]

The percentage is based on the difference from the previous month. For example, if you received $1,000 in contracted sales in January and $1,500 in February, then the number you would submit is +50%.

 

Tracking revenue is possible also, but that might not give us a clear understanding of the market since every company has a different success rate when it comes to collections.

[dinhtuan]

If i have nothing in Mar it mean -100% right? I will check our sales when back office tomorrow.

Br

Edited September 11, 2008 by dinhtuan

[EddieLeon]

Yes. Unfortunately, that is true

[Jeff Mottle]

1 - Data - What exact info do we want to collect? A single positive or negative number that is a percentage difference from the previous month's sales? Do we want to track cities, countries, project/client types, or just overall sales?

 

In an ideal world I'd like to capture the following:

 

a. Total gross revenue per month

b. Total number of bids submitted + average value of bid

c. Projected total gross revenue for next quarter

d. Precentage breakdown by industry for the above (25% residential, 50% commercial etc.)

e. Overall trend feeling (up or down)

f. Country and City (Depending how many companies participate, there could be local and global indexes as well).

 

To get this off the ground though, we could just ensure a valid industry cross section and start with the monthly percent change as you suggest. If we can get a few quarters of data under the belt, companies may be more willing to supply additonal back data to furtehr develope the index.

 

As some studios have cross over work that may not all be arch viz related, the values would need to reflect only work that only relates to architecture.

 

2 - Data Gathering - How do we collect the data? Online form or email? Who receives it? This must be a neutral person. I will nominate Jeff, but I don't want to impose more work on him

 

I think all of this would need to be collected with an online form as it will be easier to perform the calculations on the data in realtime. As I'm probably the only impartial party in the industry, as I don't work in production anymore, I guess I'd do the data gathering. CGA would sign an NDA with any parties that participate.

 

 

3 - Participants - Who and how many freelancers/studios want to participate? This can be done confidentially. Once we agree on who will collect the data everyone can then contact that person in private. Also, anyone that participates needs to make a commitment to provide the data on a regular basis. Otherwise, the index will not be accurate...

 

I think for the index to mean anything the group should be made up of a good cross section of the industry. Based on the 2006 survey results:

 

Architectural Firms 32%

Visualization Companies 32%

Freelancers 11%

Interior Design Firms 4%

 

That accounts for 79% of the market. I have the other breakdowns, but the point of this was to suggest that the number of people in the index should reflect the known makeup of the market. So if we decide that 100 companies/individuals will make up the index, then 32 of those companies will be architectural firms. The big question is how the accounting is done for architectural firms for their in house viz departments. I suspect many are considered a fixed internal costs and they do not track volume or value of work.

Edited September 11, 2008 by Jeff Mottle

[kimblarsen]

I would think most architecture firms would account for costs related to visualization in terms of salaries to the 3d artists plus the software and hardware costs and percentage of fixed costs attached to the persons working on visualization.

 

Where it becomes difficult is when people are doing visualization as part of their architectural design. Some, or most, architecture studios would probably not bother calculating the percentage of time for their employers that are pure visualization. Then again, it would probably be fairly difficult to find out exactly what is considered visualization work and what is considered architectural design.

 

For us, Placebo Effects, having come out of being an inhouse architectural visualization company, this division has become very clear. We specifiy architectural design consulting (3d modeling and imaging) separate from pure visualization, but there are times when they overlap.

 

I am no longer managing Placebo Effects but I think we would be happy to provide data for the survey. I would also like to help out with issues such as the one above; how to formulate a definition for what is considered arch viz within an architecture studio.

 

Cheers

Kim,

[StudioRendering]

I really like the idea of an index, we had one when i worked in engineering services. we would get a call from a company which dealt with that and they would collect data and creat a 10 page report each quarter. for all participants the report was free but would sell the report to magazines, publishers, university subscriptions and those who track the indusrty.