The troupe's announcement that it is putting 400 of its 5,000 staff out of work is a blow not just to the company, but to Quebec’s economic well-being and confidence. Still, with annual revenue of $1-billion, the company hasn't fallen just yet – though its feet may a bit shaky on the high wire
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Artists perform during Cirque du Soleil’s Varekai show in Lima on Jan. 16, 2013. ENRIQUE CASTRO-MENDIVIL Rising expenses amid rapid expansion
Cirque’s global roster of shows is getting increasingly expensive, with each one costing as much as $25-million to develop. The layoffs at head office in Montreal will help trim those costs and, the company says, make sure that as many of its resources as possible go to the creative process and the spectacle on stage.
The breakneck expansion of recent years was a key strategy of chief executive officer Daniel Lamarre, who joined the company in 2001. About five years ago he tripled the number of new productions to three a year.
That move now seems to have backfired, with the company unable to keep up the pace of operating multiple shows on multiple continents.
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Canada’s strong dollar has proven damaging to Cirque du Soleil’s profitability. JOHN COWIE The soaring loonie
Like other manufacturers in Eastern Canada, Cirque builds its products – the shows – in Canada using Canadian funds, and then pulls in revenue while performing in other countries. Indeed, about 95 per cent of expenses are incurred in Canada and the same proportion of revenue is generated outside the country. With the strong dollar, that is a killer for profitability. Each one-cent rise in the loonie depletes Cirque’s bottom line by $3-million.
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Guy Laliberté, CEO of Cirque du Soleil, poses with performers in 2011. CHRISTINNE MUSCHI Little outside investment
Founder Guy Laliberté has kept tight control of Cirque, holding on to about 80 per cent of its shares. The government of Dubai, which bought its stake in 2008, holds 20 per cent. The company is losing money, but the shareholders do not want to take a financial hit. Still, the company insists that Cirque is not for sale – for now at least – and there are no plans to look for an outside investor. Instead, it is looking at new models that will see partners brought in for individual shows, and it is searching for broader sources of revenue, from films or video games, for example.
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The somnolent U.S. economy has hurt many performance-based businesses as Americans are reluctant to part with their cash. WALLY SANTANA Weak U.S. economy
The U.S. market is hugely important to Cirque, especially with its large, permanent shows, including several based in Las Vegas. The somnolent economy south of the border has prompted Americans to keep their money in their pockets, and that has hurt many performance-based industries.
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Dancers from the Argentinian troupe Fuerzabruta (Brute Force) perform in New York in 2009. FINBARR O'REILLY A lot of competition
There are more and more choices for potential audiences, including a multitude of electronic diversions. Add that to the moribund global economy and it is harder than ever to pack a theatre. There is also increasing competition, even on the circus front. Fuerzabruta, an Argentine performance troupe, is now playing in London at the same time as a Cirque show, and it is getting better reviews.
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Cirque du Soleil’s Viva Elvis show folded in August, 2012. Troubled shows
Like a clown tripping over its large shoes, Cirque has stumbled several times in the past few years, with a number of failed shows that had to be shut down. In 2010, its Banana Shpeel vaudeville-type show flopped in Chicago, New York and Toronto, and was then cancelled. Zed shut down in Tokyo just over a year ago, earlier than expected, while Zaia closed in Macau. Viva Elvis folded in Las Vegas in August, while Iris, a movie-themed show playing in Hollywood, is closing this month after poor ticket sales.
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Cirque du Soleil’s show Kooza has received mixed reviews, with Britain’s Sunday Express calling it a ‘surpriising snoozer.’ OLIVIER SAMSON ARCAND Bad reviews
With so many shows under way worldwide, it is no surprise that there will be occasional negative reviews. But some have turned positively nasty, with an edge that suggests impatience with the Cirque formula and its lack of originality. In a recent review of Kooza, a Cirque touring show now playing in London’s Royal Albert Hall, Britain’s Sunday Express called it a “surprising snoozer” with “over-formulaic presentations.” The Guardian said the show was “almost entirely soulless,” and the Daily Mail said the “over-slick clowns” were “no more spontaneous than electric doors at a shopping centre.”
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Artists perform during Cirque du Soleil’s Varekai show in Lima on Jan. 16, 2013. ENRIQUE CASTRO-MENDIVIL Lack of artistic renewal
Cirque has been around for almost 30 years and, despite regularly launching new shows, it has lost some of its ability to shock and uplift audiences. Cultural reporter Marc Cassivi wrote in La Presse this week that Cirque’s prestige has eroded in recent years, partly because it is so closely associated with the “kitsch” of Las Vegas. He also said some in the entertainment industry think the company has become so structured that it does not allow individual performers to reach their full potential.
