Hello - Advice

[kseavl]

Hi
New here. Looking for advice. I am partners in a small editorial business. No employees. We do post production for commercials/videos/web/etc. Work primarily with ad agencies. Budgets have been slashed. Been a roller coaster few years now. Just when we think we aren't going to make it, a job comes in. No regularity. And technological changes are making it more competitive with younger crowd. We are bidding on three jobs for next month. We have enough funds to get to that point. If none of them happen then it will be decision time.

The only catch is our lease. Have another 1.5 years on it. Has anyone had to break a lease? We are sub leasing from a space that does similar work to our own. There are other companies there as well that sub lease. So it is not working directly with the main landlord but a like minded company. We own all our own gear thankfully. No bank loans. Just a corporate credit card. The only other way to raise some $ is to try and sell our assets. But would personally like to hang onto some of them for my freelance needs should the business close. But beggars can't be choosers. I have a solid reputation where I live with a roster of clients. They are just not producing work right now. My hope is we can weather the summer, get to fall and then see what happens. This time of year generally gets better for spot work.

If we did not have this lease, i would probably would have gone on my own or looked for a steady paycheck a while ago. The hope is running out you could say.

Any thoughts? Experiences?

[vangogh]

I've never had to break a lease so I can't offer anything from experience with that. However I would think as long as the landlord can fill the space they'd be ok if it wasn't you that was in the space. Maybe if it gets to the point where you feel like you can't afford the lease anymore you can find someone to take it over. Having someone take over the lease is probably better for the landlord than trying to come after a business that can no longer afford to pay it.

Hopefully it doesn't come to that and you can make it through the summer. One thing you can try is sending out some kind of greeting to all your clients. An email can work. You don't want to send them something asking for work, but if you can think of a way to say hi or to thank them send them an email or a card. Even without asking it sometimes reminds people you're around and gets them to send you some work they had been thinking of hiring you to do. I've done this once or twice and it did work to bring in some business. It's business that likely would have come in 6 months say, but it helped get the money in sooner.

This probably won't help now, but you can try to develop your own projects for the future. Something that can bring in a little money to help when clients are sending projects regularly.

Are there new marketing channels you can try to bring in a new stream of clients? Could you work with clients other than ad agencies? Something to bring something new into your business. Maybe you could offer a freebie for a charitable organization in town. While you wouldn't be getting paid you could turn the job into good promotion for your business helping you reach new clients.

I know things seem dire at the moment, but hopefully things will pick up. I know there have been times in my own business where I felt like it could come to an end, but I hung in there and just as quickly as things turned bad they picked right up again.

[tylerhutchinson]

Typically with a lease, unless the landlord lets you out of it (which they normally won't) you are responsible for the rent until they find someone to fill the space and replace you. So if it gets to that point where you feel you have to break the lease, maybe try to find a business to fill the spot and take over the lease. That way if it gets to that point you know someone may be able to fill it quickly so your not stuck paying while the landlord tries to get someone new.

With that business it may be a good idea to keep as much of the assets as possible. I would think you can run that out of your home as a freelance thing (like what you said) to continue to get some work ans you won't have extra rent on top of it. My business is big enough where I could lease a place for me and my employees, but I chose to keep it work at home. I have my office in my house and all my employees work at their homes which makes it much cheaper to run and operate.

[kseavl]

Thanks for the nice replies guys. Just seems like we take two steps back for every step forward. I've done all my emailing/contacting with clients. Met with new ones. Even put together some spec work widen the portfolio and cold called/emailed a different genre of client. Just not a good time to be us it seems. Hope things turn around soon.

[huggytree]

you could just go out of business....start over from your house and use the same phone #...your clients wont even know you changed when they call

start a new LLC or INC

the building owner probably wont bother coming after you when your company doesnt even exist anymore....its probably not worth the effort to go after a company with no $ to pay.......im sure its a pretty common thing right now as people continue to go under

[kseavl]

If nothing materializes in the next month or two, that will be my only option unfortunately. So far two of the three jobs went elsewhere. I am working on very small things right now that is helping a very little bit. One of the other companies/renters in our shared space is also down to their last couple months. Pretty tough for many. Such is life. Will be an interesting couple years. Double dip is certainly looking possible.

Since we have two edit suites with the same exact assets, we could divide the assets down the middle for each partner. As apposed to trying to sell it all and then split the money. It would be a better deal for me in that I would actually use mine. My partner is not an editor so would look into liquidating.

I think I would rather do that for me than to try and sell my tool to pay a lease for a half a year. I would also think the landlord (who is also in my industry) is experiencing first hand how tough things are, and would have to understand our position and let it go. Tough times mean tough action.

[huggytree]

if your survival for a month or 2 is based upon winning ONE job id say your out of business already....just in denial

your at the bottom of the decline, just waiting to go under.....

id just go ahead and go under.....every day you sit and wait is another day your next business doesnt grow(or even exist)

[vangogh]

I don't know that you have to throw in the towel. If one job keeps you going then 2 jobs keeps you going longer. All business need their next job or sale to keep going.

It sounds like if things don't work out you plan on freelancing doing the same work, so while there's nothing wrong with trying to keep the existing business going, you can still take some time now to learn from mistakes and think about how you can get a freelance business growing. Much of that thinking will likely apply to the existing business if it does manage to continue so the time won't be wasted in either case.

Plan for the future, but no reason why you have to give up on the present while you do.

[DLWindsor]

I work for a production company as well and understand where you are coming from. While you are debating on whether or not to just focus on freelance work from your home, here are a few things we have done that you might want to think about. As Vangogh mentioned above, we have recently donated a bunch of videos (they were a campaign of intro vignettes) to a big charitable organization in town that were seen by many people during a 3 day event. Donating is a great way to get a lot of good exposure for your company within the community. The organization really went above and beyond to put our logo brochures, in their lobby for the multiple day event and in their e-blast newsletter, which was great as it was seen by many of their patrons. There are so many business out there who can really use some type of video for their website or commercial, and once people know you are out there they are more likely to contact you to get the ball rolling. Also, we have been to a few networking events/mixers, especially the new member ones where you get to give an introduction on your company, where we have gotten some work as well. I am not sure where you are located, but there is work out there, keep looking!

[vangogh]

The right freebie can lead to some good work and marketing. You can really do free work all the time, but for the right project it can be a great way to market yourself and get future projects from the people who saw your work.