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JUNE 2012 | $4.95 (GST inc.)
BUSINESS PRINCIPLES BASED ON LIFESTYLE PHILOSOPHY
Yoga to yoghurt management
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COVER: David Prior has a lifestyle and philosophy that he has applied to his business of making organic yoghurt : SEE P.12
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FRANKSTON / MORNINGTON PENINSULA / DANDENONG
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YOGA TO YOGHURT:
Organic yoghurt makes seals Woolies deal with a handshake.
BUOYED WITH SUCCESS: Somerville company lights the way for world shipping.
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Visit us at www.lennoxprods.com.au to learn about our services or call (03) 5976 2225 2 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
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FRANKSTON City CEO George Modrich left the council on May 24 three days after resigning. His temporary replacement Mick Cummins, general manager corporate, had already resigned and was expected to start a new job with neighbouring Bayside council at the end of the month. While councillors were reticent about Mr Modrich’s unexpected departure, the suggestion was that the CEO of four years had lost the support of most of the nine elected members. For all legal services a business and its people need Mr Modrich said he had enjoyed his 12 Est. years1954 at Frankston and was likely to seek another position in local governGeorge Modrich ment after a break of several months. Two notices of motion adopted by sion to get independent advice on www.whitecleland.com.au councillors in April may point to some next year’s operating budget, parsort of breakdown in the relationticularly in relation to staff costs. ship between council and the CEO. Councillors reacted sharply to Mr Levelof3,the 454 Nepean Hwy Frankston 9783 2323 proposal that they “interOne motions concerned a Modrich’s CEO-inspired protocol limiting councilact or communicate only with manlors’ contact to the most senior staff. agers and general managers”, avoidLevel 8, 256 Queen Street, Melbourne 9602 4022 The other was council’s deciing contact with more junior staff.
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next year’s operational budget, particularly in relation to staff expenses. The council ignored senior officer advice that there wasn’t enough time for independent review of the budget given that the draft would have to be advertised for public comment by mid-May if it was to be adopted at the start of the financial year. Councillors also ignored advice that “many well qualified finance staff … are more than willing and able to assist council through the budget process”. The independent budget review will include advice on spending caps for at least four staff associated costs. These include staff consultancy expenses (currently $1.3 million+, 2010/2011); staff vehicle fleet/management expenses ($1.1 million+, 2010/2011); staff stationery/printing expenses ($637,000, 2010/2011); staff learning/development expenses ($653,000, 2010/2011) Another target is catering expenses ($140,000, 2010/2011).
THE future of the Baillieu government If Mr Shaw was ejected from office may depend on the outcome of allegaand the Liberals lost a byelection in the tions against Frankston MLA Geoff Shaw. state’s fifth most marginal seat, VictoThe MP is being investigated ria would have a hung parliament. for allegedly using his taxpayerThe Shaw inquiry has its parallels in funded vehicle and fuel card for federal parliament where the Gillard his hardware supplies business. government is clinging to the vote of A former senior detective and daily besieged MP Graig Thompson even paper columnist told ABC’s Statethough he has been cut adrift by Labor. line on 25 May that the Shaw allegaMr Shaw has offered to repay any extions should be referred to police. penditure found to be in breach of rules Neighbouring Labor MP Jude relating to use of his government perks. Perera (Cranbourne) also called The Frankston MP was charged with for a police investigation. unlawful assault in 1991 placed Victoria’s Newestand & Biggest Go Kart Complex Premier Ted Baillieu has ordered Legon a good behaviour bond as well as & Biggest Go Kart Complex islative Assembly Speaker Ken Smith and Victoria’s beingNewest ordered to pay $400 costs. Other the Department of Parliamentary Serrevelations include allegations he convices to investigate whether Mr Shaw’s tinues to work inComplex his accountancy Victoria’s Newest & Biggest Go Kart 11-55 Waterview Close government car and fuel card were used business, he had an altercation with Dandenong South 3175 for commercial purposes. Mr Perera a motorist pulled over by police, and 11-55 Waterview Close Dandenong South 3175 To book and receive FREE OFFER for call 0422 704 855 said it was not proper to ask another he erected a roadside signyour pleading Liberal MP to undertake the inquiry. reconciliation with hiswww.lemansgokarts.com.au former wife.
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June 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 5
BUSY bites
Signage boost FRANKSTON Council is considering boosting signage at the city’s main entrances A report to council’s ordinary meeting in June will detail appropriate sites “gateway” signage in prominent locations like Nepean Highway (Keast Park, Seaford foreshore); the intersection of Frankston Freeway and Cranbourne Rd; or a location relevant to the entry/egress point via Eastlink and/or Peninsula Link. The report also seeks state and federal funding opportunities, including potentially accessing future streetscape works funding by the state government.
Civic works Industrial Demolition Services Pty Ltd has won a $1,873 million contract for early works on City of Greater Dandenong’s new civic precinct. The contract price includes GST. The initial works on the building in the heart of Dandenong includes demolition of the entire site and associated bulk earthworks in preparation for the main construction. The contractor will clear the site of buildings and any hazardous materials including contaminated soil. The budgeted estimate for this phase of works was $1,999,870, excluding GST.
Too many bums on seats AUSTRALIA is a nation of ‘sitters’ and it’s taking a major toll on our health, according to the Chiropractors’ Association of Australia. Our office workers face a back pain epidemic and risk developing chronic diseases by sitting for almost 16 hours a day with more than half never taking conscious breaks to stand and move around, according to new research by the chiropractors. The research found that not only do we spend a dangerous amount of time sitting, but nearly 70 per cent of office workers are sitting incorrectly in a slumped or collapsed position and 60 per cent say they already experience regular or occasional lower back pain. And it’s women aged 18-34 years who have the worst posture and are most at risk of spinal damage. Office workers have only 73 minutes left in a day to stand or be active, after eliminating time spent sitting and sleeping. According to the stats, office workers are spending longer in front of a computer (almost nine hours a day) than sleeping (about seven hours a day), sit for almost one and half hours while commuting to and from work, and watch TV for more than two hours. They are also sitting for up to three hours at a time without getting up. CAA spokesperson Dr Billy Chow said the results were extremely worrying and were reinforced by an independent Australian study in 20111 which found that people who sit down for more than 10 hours a day and don’t exercise had almost double the risk of dying sooner than those with active lifestyles. “It’s critical we get off our backsides and move more because sitting for too long and in the wrong position can have a detrimental effect on our spine and on our overall health. “If we’re spending a lot of time sitting down with the same posture, it will cause spinal degeneration and joint inflammation that sends messages to the
brain to tell it the body is stressed,” he said. Dr Chow said chiropractors are seeing a much larger number of office workers with sitting related injuries. “Sitting is having a major impact on the way we function and our stress levels and is causing weight gain and lower energy levels. “The problem we face in modern society and with modern technology is that we’re going from a sedentary workplace to a sedentary home so it’s essential we sit less and be more active. “Getting up to walk around or stretch regularly
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60 Robinson St DANDENONG P: 9794 0010 - 105a High St CRANBOURNE P: 5995 4588 - Shop 51 Station St, Mall FRANKSTON P: 9769 6660 6 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
Water saving awards BUSINESSES can be nationally recognised for their commitment to sustainability and water efficiency through the savewater! awards. The business section of the awards recognise innovation and achievement in water reduction in two categories; small business (less than 15 staff) and large business (more than 15 staff). Businesses may also be eligible for the Prime Minister’s Water Wise Award. The savewater! awards®, now in their 10th year, aim to recognise and reward excellence in water conservation and efficiency by business, schools, government, local communities and individuals. The Prime Minister’s Water Wise Award recognises the significant savings in water use achieved by businesses in the commercial and industrial sectors.
Encore Tissue, a Melbourne-based manufacturer, won the 2011 large business category for its Adant Petax Fine Filtration System, which provides economical, single-stage mechanical filtration of wastewater. Entries for the 2012 savewater! Awards close at 5pm (AEST) on Friday 20 July 2012. Details: www.savewater.com.au Winners will be announced in Melbourne in October.
Transfer station
Warehouses OK
Drum advice
Australand Holdings Pty Ltd has won approval from Greater Dandenong City council for two warehouse buildings on the corner of Greens Rd and Pacific Drive, Keysborough. The warehouses will be 16,770 sq m and 12,210 sq m, both with 10 square metres of ancillary office area. Council agreed to reduce car parking requirements on the understanding that more spaces will be added as demand increases.
GREATER Dandenong City Council will appoint an advisory committee for Drum Theatre. The committee of three independent members and a councillor will be charged with developing a strategic plan for the city’s premier cultural centre. The committee will advise council on finances, policy, upgrades and future budget requirements. Council agreed that the committee could be established and operational by next month (July). Independent members will have specific skills in the arts, marketing, fundraising, business, management or relevant similar areas. Senior council officers will attend without voting rights. Final nominations for the three independent positions will be brought to council for endorsement by next month. The council report suggested payments for committee members, but no remuneration was mentioned in the committee’s final recommendation.
Biggest bite The world’s biggest brands have continued to grow in value during the current economic uncertainty, according to Millward Brown’s annual Top 100 Most Valuable Global Brands study. The No1 brand for the second year, Apple, rose 19 per cent in value and is now worth $182.9 billion. IBM grew 15 per cent in value to $115.9 billion and overtook Google, which dropped to third place in the ranking and is now worth $107.8 billion. In advance of its IPO, eight year old Facebook rose 74 per cent in value, making it the fastest brand value riser in the ranking. Worth $33.2 billion the social network moved up to No.19 from No.35. The study, commissioned by WPP and conducted by Millward Brown Optimor and now in its seventh year, identifies and ranks the world’s most valuable brands by their dollar value, an analysis based on financial data, market intelligence and consumer measures of brand equity.
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THE City of Greater Dandenong has granted a permit for development of a materials recycling and transfer station at 164-168 Williams Rd, Dandenong South. The applicant for the development is Circon Constructions Pty Ltd.
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just for a minute or two is a great way of releasing some stress. This resets your posture and gives your body a break,” Dr Chow said. With 75 per cent of Australian workers having no clear workplace guidelines regarding sitting correctly and taking breaks from desks or computers, Dr Chow said employers need to start prioritising the health of their workers. “If workplaces address what is a very serious situation, it will increase the health and wellbeing of their employees which means they’ll be happier and more productive,” he said. To alleviate health problems associated with sitting incorrectly or for extended amounts of time, Dr Chow recommends taking regular breaks at least every hour and referring to the CAA’s Sit Right checklist. To encourage Australians to take regular breaks from sitting, the CAA has launched a Sit Right desktop widget that is programmed to pop up on computer screens regularly to provide different break suggestions, as well as a range of stretching exercises people can do at their desks. The widget and the Sit Right checklist can be downloaded at www.SitRight.com.au
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June 2012 | Frankston / Mornington Peninsula / Dandenong | BusinessTimes | 7
NETWORKING
1. Brent Edwards, Business Networking International executive director, with Step Into Life personal trainers Sara and David O’Connor at BNI Cranbourne’s first anniversary celebration on 16 May at Settlers Run, Cranbourne. 2. Also at BNI’s birthday are (from left) Sarah Law, creative director of Malvolio, Mauricio Iraheta, digital director of bms digital, and Sue Clark, of pepa corporate image. 3. BNI Cranbourne guests (from left) Peter Pane, of Jim’s Computer Services, Dr Karen Dixon, of Cranbourne Park Chiropractic Centre, Joanne Haines, of Travel Managers, and Brett Theodore, of BC Magnetic.
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4. Mt Eliza’s May networking night was hosted by Mt Eliza Family Fitness and Mt Eliza Chiropractic Clinic. From left are Dr Georgie Boehm and Dr William McLoughlin, of the chiropractic clinic, with Jo Kidder, of Mt Eliza Family Fitness.
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5. Frankston Business Chamber networking at Lyrebird Community Centre, Carrum Downs, on 25 May attracted (from left) Gerry Harrison, of Cartridge Plus, Julie Comar, national sales and marketing manager of Oxford Funding, and Richard Uglow, of Coles Corporate Affairs.
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6. Business Chamber guests Sam Hanna, of Baden Powell Cellars, Mick Spruhan, branch manager of Bendigo Bank, and Tony Papadopoulos, of tpgd graphic design. 7. Simon Williams, of Wine Cellar Mornington, and Sean Higgins, of Big Man and a Van, at the Business Chamber get together. 8. Business Chamber executive officer Karin Hann with Quest Apartments’ representative Karen Watson.
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APPOINTMENTS
Olivia Moncur joined Mornington Racing Club in March in a new role combining both sales for race day hospitality and events. Olivia’s role was developed to better assist in the delivery of premium services to clients over a wide variety of events. Whether it is entertaining on a race day or hosting a private event, Olivia can tailor a package to suit any need. Call Olivia on 03 5975 3310.
Jo Stanley joined the Mornington Racing Club team mid May in a new role covering sponsorship sales across both the Mornington Racing Club and Sportingbet Park (Sandown). Jo’s role has been developed to assist businesses in the south east corridor of Melbourne to achieve their marketing objectives through the medium of race sponsorship. Sponsorship packages start from as little as $500. Call Jo on 03 5975 3310.
John McEncroe and business partner Adrian Stokes have started KISS Print Services, saying they can offer better value and a more personal and customised level of service. They say large corporates service their equipment well but their account management can be poor. Dealers, on the other hand, look after their customers well but service equipment as sparingly as possible. Usually, they can reduce customers’ costs by between 10 and 30 per cent, says John.
Make end of financial year resolutions It’s easy enough on December 31 each year to promise yourself to take things slower, get more exercise or look after your well being in general. As 1 July approaches and we move to the end of the 2012 financial year, how about making some 2013 financial year resolutions? Might sound a bit corny to some; however it is an approach that works. After all, taking care of financial and wealth matters requires focus, effort and commitment. The “good” habits don’t come naturally to everybody and end of a financial year provides a good reminder of need for action in wealth and business planning. Let’s make it easy and set down some resolutions you can adopt: • Commit to surrounding yourself with advisors who are proactive and if they are not, talk to some others. • Make an appointment with your advisor(s) and discuss a plan for your future. • Review any borrowings. Can you get a better interest rate? Are you reducing non
deductible debt before deductible debt? Do you have capital you could access to use for further wealth creation? • Set a savings plan for a certain goal or amount. • Make a Will or review your existing one. • If you are part of an industry or master trust superannuation fund, review the investment allocation option you have requested they adopt for you. • Talk to someone about whether income protection, trauma or life insurance makes sense for you. • Is your business running efficiently? Ask
10 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
for an independent review that may assist with setting of direction and areas to be concentrated on. • Ask for a review of your business structure and confirm what you have is still the best option. These are not difficult matters to get in order so make the resolution today that you will contact your advisor or call our office on 9781 3155. By Allan Williams B.Com CPA MBA Dip FS, managing director of Flinders Partners Group Accountants and Financial Advisors.
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Organic flow from yoga to yoghurt WORDS & PICTURES BY Keith Platt
IT was the thought of tasting the fruit cake and muffins every day that put David Prior off buying a ready made, profitable business. Instead of eating fruit dyed with chemical colours and cake made with bleached flour, he opted to establish a start-up company making an organic product: yoghurt.
DAVID Prior has parlayed his personal philosophies and principles into his business of producing organic yoghurt which carries the brand five:am. The name reflects Prior’s habit of rising early to meditate , practise yoga ... or, if the swell is up, hit the waves.
12 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
It was a decision made with the heart and head, not just the money. With an MBA (Master of Business Administration) under his belt and financial security Prior had taken a year off to plan his future. “I did lots of surfing and yoga. I was in a pretty lucky position,” Prior says while sitting inside his office at Carrum Downs. “I could choose the next thing. I could have taught yoga for the rest of my life, so finding a new business was not really about the money.” The recent past had been running and then selling a packaging firm at Braeside with his father Malcolm. The Beroda packaging company was named after the town in India where his parents lived before moving to Australia in 1969. Part of the sale to Amcor involved the two Priors staying aboard, but David “found it hard” sitting alongside others making decisions for what had been his company. He opted out after six months; his father stayed five years. The gap year that followed led to a yearning to be back in business. “Coming from a manufacturing background I knew there were not many things you can do considering the competition from China,” Prior says.
COVER STORY
“But food is something that Australia does well, we’re clean and green.” A profitable company making fruit cake and muffins failed to meet his needs, but yoghurt - something he liked - offered another opportunity altogether. “It was a much bigger risk, but I was following my heart and my head. I didn’t want to produce something that’s rubbish. “I knew a bit about the yoghurt category in Australia: it was a billion dollar a year market and dominated by big players. “I also knew its market was growing strongly and I liked the sound of being involved with Australia’s dairy industry, but I wanted it to be organic, something not really done by the majors. “I loved eating yoghurt and there was only one box left to tick, would I like to get up every day to try our product? That answer
was yes.” Prior said one major distributor did have a line of organic yoghurt “but it’s made from powdered milk”. “Ours is a better product, every ingredient is organic.” Once his mind was made up about a product, Prior “found a recipe guy” - former King Island yoghurt maker Martin Houben and persuaded him to “come out of retirement”. “We spent two years designing our recipes, which was a bloody challenging process getting the body and taste right. “We then had the base product which was followed by a long process formulating the types and flavours, which had to be all organic.” Buying milk and cream from a family-run certified organic dairy farm near Korrumburra in Gippsland “has allowed it to be run by the fourth generation”. Prior, now 42, had been “into” yoga and meditation since his mid-20s and the early daily rising which this and surfing entailed suggested a business name: five:am. By 7.30am every day he has done yoga and meditation or had a jog. “It prepares me for the rest of the day, which can involve 12 hours of work.” Once Prior had found his product, he needed sales. “I had done my homework and knew if I got it right there would be a market.” In November 2009 Prior managed to arrange a meeting with the group chief executive officer of Woolworths and explained the philosophy behind his five:am organic yoghurt. “I told them you could only get good organic yoghurt in health food stores, but mums need to be able to pick it up when doing their supermarket shopping. “I was willing to commit my life and money if they were willing to support me.” The deal was sealed with a handshake. “I like doing business that way, it’s the only way. There’s no contract that can’t be broken and a handshake shows integrity and trust.” Prior spent 2010 installing plant in the Carrum Downs factory, which is owned by a family trust (“that’s their only involvement, the building, the rest is all mine”). In March 2011 four five:am products went on display in 400 Woolworths stores. Prior now has 12 products in 700 Woolworths outlets, giving five:am 8400 points of distribution. “I saw the business increase five times within a year,” he says. However, that one major outlet is not enough to keep his expensive plant busy, so Prior makes yoghurt for other brands, but to their own recipes. “I would never give anyone five:am,” he says. It takes six hours to change the plant over from one product to another to avoid contamination to five:am’s organic product. “There’s nothing in any of our products that isn’t natural,” Prior says. While Prior does not set aside time for yoga or meditation for his employees, he says some production staff “have been encouraged” by his lifestyle. Hard to miss in the offices are small statues of Buddha and Hindu deities. Large photographs of tranquil scenes adorn the walls of the factory. In other manufacturing plants such pictures are embellished with motivational messages. Prior clearly prefers the approach to business and productivity - like the five:am product – should be organic.
June 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 13
NEWS
City’s after dark digital screen show CENTRAL Frankston winter nights are about to be transformed by a larger-than-life digital landscape show. The city’s first exUrbanScreens festival of projected digital art will change the face of city buildings, including Frankston’s biggest structure, the Peninsula Centre. Digital artists from all over the world are joining emerging young local artists to project their work on to and from within buildings … converting the everyday into the incredible, grunge into beauty. Organisers from Frankston Arts Centre and Cube 37 hope the digital imagery on a grand scale will lure Frankston residents into the business district after dark from 23 June to 7 July. World-renowned Melbourne digital artist Ian de Gruchy has created 30 new looks for the iconic Peninsula Centre. Named The Peninsula Projection … an image beacon for Frankston, de Gruchy’s imaginative art will convert the building’s concrete fascia into beautiful façades; one moment a vintage car engine, next Frankston’s historical Bay View Hotel. Guided tours are available from Cube 37 at 6pm on Saturday 23 June,Thursday 28 June, Thursday 5 July and Saturday 7 July. Bookings are essential on 9784 1060). Tours may be arranged on other dates by request. Book a tour for your group or explore the city streets at your leisure. Cube 37 will open Monday to Saturday until 8pm during the event.
to buy assets they can’t afford”. Maybe the money could be more wisely spent on marketing activities to generate customers, Mr Lock added. “The tax break applies only to tangible, depreciable assets like cars, computers and hardware, laptops, smartphones, and furniture – in other words, expensive items that businesses don’t necessarily need for growth. Unfortunately, many businesses jumped at the opportunity, as evident in the sudden resurgence of the previously-failing car industry, which experienced an 11.3 per cent growth in commercial vehicle sales after the introduction of the 50 per cent allowance.” Mr Lock, partner of SWAT Business Solutions and 10X Port Phillip, said that a strong push to spend by the government made many business owners forget that the allowance was not a refund or a rebate. “Small business owners shouldn’t assume that all government initiatives are in their best interests. Although this increased spending benefits the economy, it’s ultimately a knee-jerk reaction that has encouraged hasty spending, and does not give businesses any real cash advantage in the end.” “It’s critical that business owners consult with their accountant now and put into place a tax management plan and business growth strategy for 2013.”
A DOWNSIDE TO SMALL BUSINESS TAX BREAKS
SOMETIMES we’re speaking two languages at once, even though the words are English. Everyone expects politicians to avoid handing out bad news and salespeople are renowned for holding back on a final price. Tough defamation and libel laws have seen the media and public speakers adopt a code to convey a message: In its simplest form ‘tired and emotional’ means drunk and a ‘colourful character’ is a crook. Researchers in Australia and New Zealand have looked at how language used by CEOs and executives – particularly the tone and choice of words in financial reports – holds
SMALL business owners may be tempted into inefficient spending under the Small Business Tax Break, according to accountant and business advisor Wayne Lock The tax break provides an incentive for small business owners to invest in eligible assets through a 50 per cent tax deduction. However, Mr Lock said that “what once seemed like a lucrative incentive for small business owners could actually be a misleading lure that encourages some owners
Talk may be cheap, but IT can also be costly
14 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
FRANKSTON’S Peninsula Centre transformed into the grille of an old Holden through the ingenuity of Melbourne digital artist Ian de Gruchy.
clues to possible deceptive conduct. In a paper published by the Journal of Business Ethics, Professor Russell Craig, Head of Victoria University’s School of Accounting and Finance, and his colleagues Tony Mortensen (University of Canterbury) and Shefali Iyer (Deloitte, NZ), say reports and letters written by fraudulent company bosses contain distinctive linguistic tendencies. The researchers used as their case study the Indian multi-national Satyam, which collapsed in 2009 after company chair Ramalinga Raju confessed to extensive deception over US$ 1 billion, in company earnings and assets. Drawing on research into the common markers of deceptive communication, as well as software designed to quantitatively trace linguistic patterns and trends, they found that Raju’s choice of words was consistent with patterns used by those engaged in deception. In particular, the researchers noticed the following linguistic ‘alarm bells’ in the five annual report letters preceding the company’s collapse: a shift from first person singular pronouns (I, me, mine) to plural pronouns (we, us, ours); a dominant positive tone; a tendency to use positive emotion words; and a pronounced reluctance to use numerical terms. The researchers say linguistic signals present warning signs to auditors and regulators, and that systematic analysis of language, and not just numbers, should become routine in auditing processes. “Changes to current risk assessment processes appear to be justified in view of the fact that neither Satyam’s auditors nor market regulators identified or suspected that a major fraud was being committed,” the research report stated.
Search engine optimisation for your business: Getting the right results With Yellow Pages possibly losing impact as a marketing tool, many of our customers are asking for assistance in getting more customers from their websites. Over the years, we have built up a lot of experience with Search Engine Optimisation, not only to get visitors to the site, but to convert them into customers. Search Engine Optimisation is one of the cheapest ways of marketing your business and with a little planning you can be adding new customers every month to your business through your website. 1. Identify who you are trying to attract: Who is your ideal customer? What size are they? Where are they? 2. What problem do they have that you can solve? This is very important because it will be a solution to their problem that they will search for. 3. How do you present that on your website? If you have the solution to their problem, make sure that you mention what that problem is, not just the solution. 4. Is your website SEO friendly? Each page should have an objective, such as attracting customers who need Tax Advice. That page should have a title, keywords, tags, meta data, and image tags that all reflect that you give Tax Advice. This helps Google know what kind of information your page has. 5. Make sure you monitor the effectiveness of your site: Google Analytics is free and more than adequate for 99 per cent of users. It tells you how many people have found your site and how they got there. 6. Avoid Flash: Flash addins and even entire sites were very popular a couple of years ago, but Google can’t read what is written in flash, therefore it doesn’t refer users to the site. You don’t want to have the best website that no one has ever seen. 7. Update Frequently: Search Engines love to see information that is update frequently, so try to keep you content up to date. We recommend you use a website with a basic CMS so you are able to add your own content, and not have to wait for your web developer. 8. Using Social Media? If you have a Facebook or Twitter feed, make sure you cross pollinate between the three. Updates on the website should go to Facebook
TWELVE–month Google Analytics statistics for one of our websites. Notice the amount of traffic coming from search. Don’t you wish you had 1.3 million visitors in a year?
and Twitter and you should have links on your website for both. 9. Links: Make sure you have as many good links into your website as possible. The more good links that you have, the more important the Search Engines will think your website is. So there are a few tips to help you get more customers from your website. The websites don’t have to look amazing, they just have to tell a great story about what you do and the problems that you solve. Google will help you with the rest. If you have any questions, please give the team a call on (03) 97857162 and book in for a free 10 minute SEO consultation to help you get on the right track.
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June 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 15
FEATURE
SMALL beams of light from Somerville are lighting up the world. The sun’s rays harness power for the beams which keep glowing long after the light fades from normal incandescent globes. Circuit boards put together by a robot enable the light to be monitored for movement and their power supplies checked on computers. This science fiction-sounding scenario is a reality for products built by Somerville-based Sealite. A hobbyist’s assertion that he could make a better navigation light for a mussel farm in Port Phillip off Beaumaris was the beginning of Sealite, which now has navigation lights showing the way for ships and aircraft around the world. Jeff Proctor, an accountant, was on the bayside beach in the early 1980s when he spotted the battery pack powering the mussel farm’s safety lights and decided he could do better. The fortunes of the backyard business started by Proctor virtually follow the development of the LED (light emitting diode) as a form of illumination. The first LED was produced in 1927, but it was several decades before a practical use was found. By the mid-1990s LEDs came into their own, being available in all colours and able to light large areas. Their reliability and relatively low power usage made them an ideal match with solar
Buoyed WORDS & PICTURES BY KEITH PLATT
panels, especially when attached to remote pieces of equipment, such as navigational buoys and markers. Chief executive officer Chris Proctor and his father Jeff have kept the company securely in its niche, branching out onto land to equip remote and outback airfields. Alice Springs and airports in Japan and Taiwan run on Sealitesupplied solar powered landing lights and the Unites States military have bought kits that can be deployed for a remote airfield within 45 minutes. The US military is the company’s largest single customer while the country itself is its biggest overseas market. Sealite has an office and warehouse in New Hampshire with a staff of 10. Europe also beckons as a logical next overseas base with its a growing dependence on offshore wind turbines to generate electricity. However, the overall marine market makes up the greater part of Sealite products. Ironically, it was only after its international success that Sealite became widely recognised in Australia. Now, if you are out on the water at night in Port Phillip or Western Port chances are that the lights steering you home are from Sealite. Chris Proctor says investment in equipment and personnel have
16 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
WITH success been the keys to the company’s expansion and success. Engineers develop products that are then taken to the market, rather than having the company wait for orders or suggestions from clients. Among the latest pieces of equipment is a robotic arm for making circuit boards. One of the company’s two rota moulding machines can make buoys up to three metres in diameter. Chris proctor believes investing in technology and machinery gives his company an edge over competitors who contract out much of their production work. “It’s expensive, but we now own two rota moulders. We bought a machine from Brazil, which is one of the most efficient available, which means we reduce costs and can stay competitive throughout the world,” Chris Proctor says. “We keep our eyes and ears open [for ideas]. We have a very strong engineering department which does research and development as well,” Chris proctor says. “Often it’s a question of deciding what we shouldn’t do and selecting the right product.” Development of the bright lights that form the basis for Sealite’s core business continues with “brighter and more efficient” versions. “They seem to come every month,” Jeff proctor says. “The buoys fitted with LEDs only need to be serviced once a year instead of every month. They’re often out in the middle of nowhere and it’s the batteries that are checked, the LEDs will last 10 years.” Sealite’s decision to buy plant and equipment followed inquiries
SEALITE CEO Chris Proctor (above left) says investment in the latest technology is paying off for this Somerville-based manufacturer of navigation lights.
from customers wanting to buy buoys. It was then a natural shift, with an eye on quality control, to move into making the circuit boards that can be combined with satellite technology to monitor the offshore installations. Improvements in antennas have enabled the remote monitoring and control of installations. Computers and mobile phones are used to see if the lights are working, check voltage output and track the buoy’s location with GPS. An alarm will instantly show if there is a failure. Although LEDs have gone ahead in leaps and bounds, with Sealite finding uses for each innovation, the same cannot be said of solar panels. “The amount of power being generated has only increased marginally, from 14 per cent to 18 per cent. “Battery technology has improved and the affordability of add-ons has come down.” Chris Proctor believes the lack of improvement in the capacity of solar panels to generate electricity comes from the decision by manufacturers to concentrate on making their product cheaper and the expense of it being more efficient. Next on the aviation product list is a helipad lighting system for use in remote areas, such as outback mines. There is also something else in the wind, but Jess Proctor is keeping it close to his chest: “We’re working on technology … nothing revolutionary, just better. I can’t talk about it just yet.”
June 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 17
THE ARTS
FRANKSTON mayor Cr Brian Cunial welcomed venue operators from across Victoria who came to Frankston on 29 and 30 May to see cameos of touring shows on offer to theatres over the next 12 months. With Cr Cunial (second from left) are Greg Hordacre, director of The Drum Theatre, Dandenong, Rod Wilson, manager of Darebin Arts and Entertainment Centre, and Robin Batt, manager of Frankston Arts Centre.
The business of show business VICTORIA’S regional arts community leaders have met at Frankston Arts Centre to sample and buy shows for their next theatre seasons. Showcase Victoria, the state’s touring forum, rolled into town on 29 and 30 May to give venue operators the opportunity to sample 38 productions on offer over the next year. Actors, dancers, comedians, classical and contemporary musicians, cabaret artists, circus performers and even a baby dinosaur performed for venue managers from Bairnsdale to Bendigo, Rosebud to Shepparton, with dreams of taking their shows to the audiences of metropolitan and regional Victoria. “Showcase provides a forum for venues from all over Victoria to gather, discuss and sample the latest works in a wide variety of performing arts genres with a view to buying into future tours,” said Gill Thompson, Frankston Arts Centre’s manager of business development and marketing. “The event promotes producers and performers throughout Victoria by introducing them to the presenters at the venues that play a big part in supporting their ongoing success. “In presenting quality arts programs, venues play a vital role in regional community development ensuring that non-metropolitan audiences have access to the highest quality work,” Ms Thompson said. Showhas how Since it’s modest inception in 1999, Showcase Victoria
grown to become one of the most important performing arts touring events in Victoria, bringing performing arts projects and venues together in one comprehensive event. “Showcase is a fabulous doorway for producers and performers into the world of suburban and regional venues and presenters across Victoria, and vice-versa. Through this forum both performers and venues play an important part in building relationships, and fostering the role that these art forms play in communities across our state”, said Jenny Ryssenbeek, Executive Officer, Victorian Association of Performing Arts Centres.
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Also at Frankston Arts Centre for Showcase 2012 were Tamara Jungwirth, CEO of Gasworks Arts Park (left), and Marisa Cesario, performing arts coordinator for City of Kingston.
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TECHNOLOGY SURVEY
Digital uptake quickens Australian enterprises are embracing new digital technologies to meet customer expectations, provide products and services and create new business opportunities, according to the Optus Future of Business Report. The report released on 24 May found that meeting customer expectations (72 per cent) is business’ number one driver for offering digital or online applications, followed by being more innovative at 53 per cent. This is well ahead of reducing costs (39 per cent), increasing revenue (34 per cent) and matching competitor offerings (22 per cent). It also uncovered that 29 per cent of enterprises now offer mobile websites to customers, up from 12 per cent a year ago. This is expected to rise to 47 per cent in three to five years. Forty eight per cent of organisations plan to make mobile applica-
tions available to customers in three to five years, up from 18 per cent now. Half plan to interact over social media in three to five years, up from 39 per cent currently and more than double what it was a year ago. “Our research shows that digital technologies can help business and government organisations create new revenue streams and improve engagement with clients and stakeholders,” said John Paitaridis, managing director of Optus Business. “Australian enterprises should start reviewing their digital preparedness to ensure they have the right strategies and technologies to capitalise on these opportunities, or risk losing their competitive advantage – especially in a global marketplace. “Our research shows businesses are taking action, with 90 per cent of organisations expecting to deploy digital applica-
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tions in three to five years.” Entertainment services and retail businesses expect the greatest increase in revenue from the online channel and are leading the way in making available peerto-peer and mobile payment systems. On average, entertainment services expect to increase revenue from the online channel by 10 percentage points over the next three to five years, while retail businesses anticipate an 11 percentage point rise over the same period. Mobile payments are expected to increase, with the report finding 37 per cent of retail businesses and 39 per cent of entertainment services businesses intend to offer mobile payment services in three to five years. This is up from four per cent and eight per cent of companies respectively that offer these services now. The report exposes the need for business units to collaborate more effectively on their digital strategy. Findings highlight a lack of coordination between the teams responsible for delivering digital projects.
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June 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 19
HEALTH
Don’t worry, be happy There’s a lot of unhappiness about, have you noticed? So many people are grumpy, irritable, depressed. It’s an epidemic, the health authorities tell us. (Around here it’s mostly to do with Collingwood’s injury list and a cursed run of onshore winds blowing out the surf.) While plenty is talked about depression, the West also seems to have got interested in its counterpart – happiness, and its causes. Actually, some fascinating research is starting to appear. For instance, in the US, researchers have found that happiness can spread from person to person. Their project – the Framingham Heart Study, reported in the British Medical Journal – followed 4739 people between 1983 and 2003. Participants were asked to identify their relatives, friends, home, and workplace to ensure they could be contacted every two to four years. Their happiness was measured using an accepted psychological scale. The researchers then investigated the degree to which social networks correlated with reported happiness. They found that if live-in partners became happy then the likelihood of their partner being happy increased by 8 per cent (the phenomenon well known to some blokes of my acquaintance as “happy wife, happy life”). But wait, there’s more. Similar effects were seen for brothers and sisters living nearby (14 per cent more likely to be happy) and even neighbours (34 per cent more likely!). Work colleagues did not affect happiness levels, suggesting that social context influences the spread of emotional states. The study found, though, that the relationship between people’s happiness can extend up to three degrees of separation (that is, even to the friend of a friend of a friend). So bottom line is, if you are surrounded by happy people you are likely to become happy yourself. Physical proximity appears to be important in order for happiness to spread. A person is 42 per cent more likely to be happy if a friend who lives less than 1km away becomes happy.
Michael Ellis*
Chinese Herbalist
‘Bottom line is, people who are surrounded by happy people are likely to become happy themselves’ The effect is halved if the friend is 3km away, and becomes insignificant at greater distances. How can this be? About the only conclusion one can make is that a certain amount of choice is involved, that one’s attitude to life is influenced by the attitudes and emotional states of others. But let’s say everyone around you is miserable. How do you get happy (and pass that happiness on)? Does money make you happy? Yes, as it turns out … but only if you give it away. An experiment reported in Science (2008) involved giving students cash windfalls with instructions on how to spend it. This study found that those who gave the money away to charity or as a gift were happier at the end of the day than those
20 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
who spent it on themselves. In another survey, 16 Boston company employees were interviewed before and after they received bonuses of various sizes, and in a related study, researchers gathered data on income, spending and happiness from 600 people across the US. In both instances, happiness correlated with the amount of money people spent on others rather than the absolute size of their bonus or income. In Chinese medicine, we see a connection between happiness, relationships and the health of the heart. In our world view happiness comes from a healthy heart – and keeps the heart healthy. There’s a long explanation but let’s stick with the Western perspective. Many studies show that an absence of happy or fulfilling relationships is bad for your heart. It is a fact that among the elderly population, when one partner dies, the chances of the other dying of a heart attack within five years increases five-fold. So being happy is pretty important to both your own longevity and your partner’s! Many years ago, an American self-help guru was touring Australia, running expensive seminars about positive thinking, fulfilment, happiness, getting fabulously rich on the stock market – all those essential things. My best mate handed over his hard-earned and joined the throng at a function centre in the city. The guru’s centrepiece was a story about a pilgrim’s journey to find a wise old monk reputed to have the secret to happiness. When he finally gains an audience on the mountain-side with the wise monk, the pilgrim gets to ask his million-dollar question. After a long pause, the monk finally says: “Be happy.” That was it! My mate paid 200 clams to be told the secret to happiness was “be happy”. Ripped off! Or maybe not. The moral of the story is this: happiness is a choice. Humans can choose to be happy – or not. And it can rub off. It’s worth a try. * Michael Ellis is a registered Chinese herbalist. Visit www.mtelizaherbal.com
MARKETS
Hope for the Canning: Buru’s energy horizons Among the massive changes we’re witnessing is the unlocking of shale gas deposits, most spectacularly in the US where 30-40 small ASX companies have joined the US gas rush. One group that stayed home to focus on our own shales is Bruru Energy which has gathered a vast swathe of hydrocarbon rights across 40 per cent of WA’s Canning Basin Stock Analyst
from mountains and forests long since eroded. At depths of 1000-3000 metres a series of coarse and tight beds formed which we believe hold trillions of cubic feet (TCF) of gas just like the equivalent Devonian shales of the US and Canada. But how many trillions? Only drilling will tell, but on analogies with the producing US shales the expectation is 250-300 TCF – a massive (five times the Browse Basin). Estimates vary for the gas in Bruru’s blocks, but 30-60TCF is plausible. Equally interesting is the conventional light oil that has flowed in small amounts from 8-9- wells among the 20-22 drilled over the last 80 years. Bruru’s founder, Eric Strietberg, has long thought these efforts were piddling. He was vindicated when Bruru’s Ungani 1 flowed light oil last year at over 1400 barrels a day. This flow suggests that Bruru and other tenement holders may have multiple hydrocarbons at different levels across an area half the size of Texas. While the oil
These shales are so broad they’re almost impossible to miss, but weighted down by 2000-3000 metres of sediments, they’re tight with very poor porosity and almost as hard as concrete.
Western Australia’s Canning Basin.
To understand the significance of this land bank we need to digress for a moment to mention the great changes in drilling technologies of the last decade. To over-come what seemed to be looming US oil and natural gas shortage in the US there was a push to build much more powerful drill rigs to penetrate to shale beds far below the conventional oil and gas reservoirs. These beds which fed the more porous upper reservoirs are deep, but often very thick and spread for hundreds of kilometres across what were once the floors of ancient inland seas and rift valleys. These shales are so broad they’re impossible to miss, but weighted down by 2000-3000 metres of sediments, they’re “tight” with very poor porosity and almost as hard as concrete. That has proved no great
Richard Campbell* Stock analyst
obstacle. Today’s big rigs not only get down quickly to those levels, but turn their drill bits and travel from vertical to horizontal. To unlock the gas the shale is fractured with ceramic beads under enormous water pressure. The same technology applies to the Canning’s shales which have been studied for 30 or more years using seismic and bore hole data from various drilling campaigns for water, coal and oil. In simple terms the Canning was once two great troughs between two stable land masses, the Pilbara and the Kimberly. Over millions of years sediments poured into these depressions
prospects are limited the real joy would be production of condensate, the intermediate hydrocarbon state between oil and gas with its high energy content. One expert report suggests a billion barrels is possible. The next step is the deepening of a well abandoned during the last wet season. It sniffed gas and now has a prospect of oil by early June. Success would mean that the oil horizon extends 50kms south east of Ungani - that is, a large oil structure. But our record with on-shore oil is poor. It is an old continent with old impervious rocks. The positive is that crude oil trades at $90-100 a barrel now that the world’s easy oil is half gone. That alone makes condensate discoveries highly attractive. Since one TCF of wet gas equates to about a billion dollars in revenue, Bruru shareholders will have their fingers crossed short, mid and long-term. *Richard Campbell is Executive Director of Peninsula Capital Management, Tel. 9642 0545.
June 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 21
management
Essentials of deployment The artform of management is manifested most clearly in how you deploy your business strategy. This is where most business leaders should invest the vast majority of their time to ensure that their business concepts and strategies are going to work and reap the business successes of their dreams. In any business, the cost of people is a major financial burden so the optimisation of this human potential is a critical success factor. This means that every employee should make the very best effort to implement your strategies, thereby growing both the business and themselves, while enjoying the work. There is little doubt that business owners are motivated to work like this, but it is much more difficult to get the same commitment and effort from more junior people. There are a few essential steps that you can take to ensure that your people make the maximum personal discretionary effort to implement your strategies and achieve your goals. Firstly, your people need to understand clearly and precisely your main strategies at both the company level and at their own job level. It is rare for a company to have just one key strategy so this usually means that you have to explain how your individual strategies combine together to achieve your target business outcomes. This cascade of strategies and goals throughout your organisation is complex and requires substantial discipline to design and implement. It is best achieved by creating a dialogue between the top business team and everyone else in your organisation. Even the most junior employee should be asked how they could contribute to the achievement of the outcomes defined by the strategies. Through this process, a series of roadmaps, personal action plans and goals can be developed that will maximise the probability of success. Secondly, the business owner and his/ her top team need to decide if these action plans have a high enough probability of success Sometimes the best efforts of the existing organisation and resources just won’t do it, so it may be necessary to reallocate resources to increase the probability of success. This may mean that a second iteration of the plan is needed,
Hamish Petrie*
Business Consultant
once the reallocation of resources is implemented, but this should be simpler than the original phase. If restructuring is required, then it is preferable to do it after the initial iteration of the plan but before the plan is finalised. This is the time that the organisation will best accept the need for change and adjustment to a new structure. Thirdly, as your people implement these plans, your behaviour as the business owner is very critical, as everyone will be watching to see how you react to the dynamics of the real world. This requires exceptional communication and consistent reinforcement with every team and individual in the organisation. For example, at one stage, our business leader decided that our safety performance was a major strategic barrier that we had to overcome. He took the initiative to define that every meeting should start with a safety item, and every conversation should start with safety. If he asked you “ how are things going today”, he expected that you would reply first about safety. This started a process of refocussing on safety, which has continued now over many years to the extent that it has become a strategic strength for the company. Fourthly, the flow of communication in the organisation must be enhanced so that issues and trends can be identified as early as possible. Early recognition of failures will allow intervention to modify, adapt or even drop a strategic element that is not working. In any planning process, there is always a judgement to be made about the degree of stretch in the goals, which can make or break the organisation’s confidence to achieve them. If the goals are too easy, then the organisation relaxes and cruises, whereas, if they are too difficult, then firstly
22 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2012
individuals and then teams will fail to really strive to achieve them. If you choose to tension the organisation highly, then you should also increase your visible leadership and communication to ensure that your people understand why the challenging goals are so important to the business. This should help to build their commitment to strive for the stretch goals. Lastly, one of the key aspects is motivating people to strive for strategic stretch goals by ensuring that they have some personal benefits in making these extra efforts. While it is always great to work for a successful organisation, this is not enough on its own to continue to motivate your people. The sharing of successes needs to be carefully designed within your deployment plan so that teams and individuals understand the potential benefits that they will gain if the organisation deploys the strategies perfectly. There are many ways that success can be shared from simple public recognition for a job done well through to team and individual financial rewards. While the quality of the strategic plan deployment differentiates a great business from an average one, remember that it is the visible behaviour of the business owner or leader throughout the deployment that really essential to success. Action Planning Questions: 1. Have you a disciplined process to transform your strategic concepts into action plans, roadmaps and personal goals for all of your people? 2. Have you considered reallocation of resources to enhance the probability of success of your deployment plans? 3. Have you identified a new aspect of your behaviour and/or time allocation that will enhance the deployment plan? 4. Can everyone of your people answer the questions: What are this business’s major strategies and goals? How does your work connect to these goals? 5. Do you have a clear structure for the sharing of the successes that is connected to ideal deployment of your strategic plan? *Hamish Petrie had a 37-year corporate career including 25 with Alcoa Inc. His latest position was VP People and Communications for the Global Alcoa Corporation based in New York. He can be contacted at hamish@ nitroworld.net or on 0404345103. © Hamish Petrie 2012
Fraud is the big loser NO matter what security precautions are in place, it seems businesses are being taken for a ride. An investigation of international 1388 fraud cases shows that most are only uncovered after a tip-off. Management reviews and audits uncover about 29 per cent of frauds against businesses, although most of these crimes continue over more than 12 months. The findings by United States-based Association of Certified Fraud Examiners place business fraud losses around the world at five percent of annual revenues, US$3.5 trillion. He 2012 Report to the Nations on Occupational Fraud & Abuse places the median loss caused by the occupational fraud cases in the study at US$140,000. More than one-fifth of these cases caused losses of at least US$1 million. It says schemes continue for months or years before being detected. The frauds in the study lasted a median of 18 months before being caught.
Most tips reporting fraud come from employees of the victim organisation. The median loss among frauds committed by owner/executives was US$573,000,
the median loss caused by managers was US$180,000 and the median loss caused by employees was US$60,000. The smallest organisations in the study suffered the largest median losses. These organisations typically employed fewer anti-fraud controls than their larger counterparts, which increases their vulnerability to fraud. Because they had fewer resources, the losses experienced by small businesses had a greater impact than they would in larger organisations. The report recommended that small businesses managers and owners should focus their anti-fraud efforts on the most cost-effective control mechanisms, such as hotlines, employee education and setting a proper ethical tone within the organisation. Most fraudsters exhibited behavioral traits that could serve as warning signs of their actions. These red flags — such as living beyond one’s means or exhibiting excessive control issues — would not usually be identified by traditional internal controls. Go to www.acfe.cpm to access the report which also provides a check list to help organisations prevent fraud.
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