The Silver Lining

A level head is your best defence against the credit crunch, says Jason Arber. What's more, the crunch could even benefit the creative industries.

To the casual observer it must seem like the four horsemen of the financial apocalypse have ridden into town, trampling roughshod over banks, airlines and inflation. There's a gnawing feeling that all this financial mayhem is bound to have some kind of knock-on effect to the creative industries, like the ripples from a very large rock dropped into a very small pond.

At the moment, it's financial institutions that are bearing the brunt of the chaos. Like Doctor Frankenstein, banks and insurers built a modern Prometheus out of insecure mortgage deals and dodgy hedge funds, and, well, we all know how Mary Shelley's novel ended. The credit crunch has, at the time of writing, claimed several banks, forced others into hasty mergers and created a desperate, bear market atmosphere where even apparently stable institutions can disappear overnight.

Rising fuel costs and spiralling inflation are already affecting us all, but things will undoubtedly get worse before they get better. Clients will go out of business, taking us with them if we're not careful, and budgets will get slashed.

In reality, it's not the end of the world, just a very steep, painful trough in a graph that had previously seen an unsustainable spike. We'll hit the bottom, and slowly begin to claw our way back again, leaving a number of companies and institutions dead and a good deal more bruised and battered. The trick is to weather the storm, and that's mostly down to common sense.

The number one rule for any company or freelancer is to not put all your eggs in one basket. Look at your clients, and mentally work out what would happen if your biggest one were to go out of business leaving your invoices unpaid. Would it be annoying but survivable or would it take you down as well? If it's the latter, you need to start thinking about getting some more clients and spreading the risk.

If you do find that new clients are thin on the ground, then maybe it's time to update your portfolio or showreel, or perhaps learn that new application that'll make you seem like a more attractive proposition.

Look after your existing clients and treat them like gold. I'm not suggesting giving them foot rubs and letting them sleep with your sister, but give them exceptional, prompt service. Respond to their emails and phone calls in a timely fashion and take them out for lunch once in a while; they'll appreciate it. Rest assured, if you don't, someone smarter than you will, and when the atmosphere crackles with financial uncertainty clients can be as fickle as Paris Hilton dropping her Sidekick for an iPhone.

You shouldn't put your fingers in your ears and sing 'la-la-la, credit crunch, I can't hear you,' but equally you don't have to drive to Tesco, stock up on baked beans and head for the hills.

When the dotcom bubble burst in 2001, it actually had the positive effect of sorting the wheat from the chaff. Overinflated concepts, such as and Flooz, bit the dust, while smarter companies with a better grasp of what the internet community required, like Amazon, actually prospered. Smaller, more innovative companies were also in a good position, filling niches without the need for billion-dollar investments.

The dotcom bubble saw a lot of people with Microsoft FrontPage on their CVs jump on the internet bandwagon and claim to be web designers. When the bubble burst, they scurried off to become estate agents and take advantage of the housing market bubble. If the same thinning of the herd happens again, leaving the cream of creativity, then maybe that's the silver lining to the current cloud of uncertainty.