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ISSUE 46 / JUNE 2014
FRANKSTON / MORNINGTON PENINSULA / DANDENONG
TONY MURRELL KEITH PLATT MARG HARRISON DAVID HILET MELANIE LARKE SIMON BROWN Design MARLON PLATT Finance ANITA HILET
Publisher / Director Editorial Director Sales Director Managing Director Material production / Prepress
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Company tax cuts and $11.6 billion for infrastructure.
OUR SILICON VALLEY: Young entrepreneurs set to make their mark in the world of business.
Columns
Email: General: inquiries@businesstimes.net.au Editorial: news@businesstimes.net.au Advertising: sales@businesstimes.net.au Artwork: production@businesstimes.net.au
Networking: Ivan Misner 10 Social Media: Jessica Humphreys 16 Excel: Neal Blackwood 16 Health: Mike Ellis 18 Markets: Richard Campbell 19 Managing: Hamish Petrie 22
BusinessTimes is published 11 times a year by BusinessTimes Pty Ltd and printed by Galaxy Print & Design, 76 Reid Parade, Hastings, Victoria 3915. Postal: PO Box 428, Hastings, Victoria 3915 Tel. 03 5979 3927 Fax. 03 5979 7944
Make sure every business knows your business. For advertising, contact Marg Harrison on 0414 773 153 or marg@businesstimes.net.au
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als aNIMIN hIs are Nature
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get theandbud bouts as es rounda ’s financ nation swings Juggles coalition
COVER: Michael Johnson has turned a boyhood dream into a business and a tourist attraction: PAGE 12 Background photo: Cape Barren Goose at Moonlit Sanctuary, Pearcedale. Keith Platt
s ians r valsesue and politic ouseeing busines stakes we’re the values’ failing in
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DISCLAIMER: Information in BusinessTimes contains general advice only. No article or column has been prepared taking into account any individual reader’s financial situation, investment objectives or particular needs. Readers should personally consult professionals for advice on any matter, including investment, health and the law. While all care is taken, BusinessTimes accepts no responsibility for errors or omissions in the published material. Views expressed are not necessarily those of BusinessTimes Pty Ltd. All content is copyright.
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I dreamed of being... a success at everything I tried (but life doesn’t work like that). My first paid job was... as a warehouse employee packing orders of toys for Christmas. Unfortunately it was in Fitzroy and when travelling to work I spotted a fire in the distance. It was the warehouse, so the job didn’t last long.
In 10 years I will be... cruising around Australia, surfing, helping with the DSAA (surfing experiences for people with disabilities), retired and hopefully enjoying grand children. Our business planning entails... providing up to date information and the best service that I can for horses in my care. Tip for success... provide a good service or product; charge appropriately for it and make sure you get paid. I am inspired by... the kindness of people in caring for their animals. Anyone starting a business... should have a goal, an appropriate business plan and the ability to review it honestly. I’ll know I’m successful when... when all the small things I do add up to a good outcome. My mother and father always told me... to do the best you can. I wish I had... a better understanding of people early in my career. I wish I had not... been a little arrogant in my youth.
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federal budget
Swings and roundabouts Business was spared the full weight of cuts recommended by the Commission of Audit which included abolishing 17 industry assistance programs, merging two, and reducing funding for four.
Business and the Budget
* Lowering the company tax rate to 28.5% for up to 800,000 small and medium sized businesses, starting 1 July, 2015. * $11.6 billion for the infrastructure sector, including $1.5 billion for East West Link in Melbourne, $2 billion for WestConnex Sydney, and $866 million for Perth Freight Link. * Removal of carbon and mining taxes. * $200 million additional capital to the Export Finance and Insurance Corporation (EFIC) and $50 million increase to the Export Market Development Grants (EMDG) program. * Establishment of a $484.2 m Entrepre-
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The Federal Budget announcement cutting company tax rates from 30% to 28.5% will benefit a considerable number of businesses. However, the cut will be offset for the nation’s largest 300 businesses by the Paid Parental Leave Scheme levy. Commentators already have noted that the Paid Parental Leave Scheme and levy appear in government contingencies, suggesting some uncertainty about their implementation. The infrastructure package announced by Treasurer Joe Hockey is aimed at improving road, rail and air transport links, but is heavily weighted towards roads (eg. Melbourne’s East West Link). The construction phase will initially benefit engineering and construction firms as well as building product suppliers. Improved freight movements and passenger transport should assist productivity.
neurs Infrastructure Program, focusing on commercialising ideas, and small business capabilities and access to information. * Restart initiative contributing $10,000 over 24 months for employers hiring a person aged over 50 who been unemployed for more than 6 months. * Businesses in health and biomedical, resource technologies, and advanced manufacturing are targeted beneficiaries of the new Industry Skills fund whose objective is to provide specialised training to these sectors at a cost of $476 million over four years, with business expected to make a co-contribution. * The feds will contribute $100.6 million to the $155 million Growth Fund that has contributions from both Victorian and South Australian State Governments and Holden and Toyota. This program will assist transitioning industry, businesses and individuals affected by the end of car manufacturing through five different programs. 6
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BUSY BITES: 2014 federal budget reaction
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Peak retail industry body the Australian Retailers Association (ARA) welcomed moves in the Federal Budget to get spending under control. However, concerns have been raised over the impact of increased taxes on consumers, said ARA Executive Director Russell Zimmerman. “While the ARA supports the government’s reduction in spending, there are concerns about effects on spending and confidence. We are only just beginning to see retail and the services sector regain momentum after many years in the doldrums. It would be a travesty if these tax increases impacted on that recovery to the sector and the services economy.” The ARA commended reducing the long-term blow out in government debt and scrapping the carbon tax. “The ARA was also pleased to hear $1 billion a year in red tape will be removed – allowing retailers to get on with the job of doing business. “We are still waiting, however, for a decision to be finalised on removal of the low value GST exemption for overseas goods under $1000,” Zimmerman said.
solid start: business council The budget was a solid start to putting the fiscal strategy back on track, but there is much more work to do to support growth and deliver a sustainable budget position for the long term,” Business Council of Australia chief executive Jennifer Westacott said. Westacott said it was disappointing to see ad hoc measures such as the deficit levy included in the budget. “Changes to health and social security arrangements need to be implemented carefully and sensitively to ensure the safety net remains for those who need it most and to avoid unintended consequences of changes that could place an unfair burden on particular groups in the community.
“We are very concerned about the risk that savings are falling too heavily on some families and young people trying to find work. “It is important that we lift our game now in skills development, improvements to job services programs and more flexible workforce arrangements,” Westacott said
tax reform for all: accountants The first step to address revenue shortfalls is to revisit the Henry Review and look at the most efficient ways to collect tax,” said Institute of Public Accountants’ chief executive officer, Andrew Conway. “Temporary taxes are no panacea for genuine tax reform. “Short term initiatives to fill the revenue gap can be damaging to a fragile economy, particularly in terms of small business. “Piecemeal tax hikes can erode business confidence and may not produce the anticipated revenue levels as it can lead to behavioural changes.” Conway said the IPA was “very pleased to hear that the government is apparently going to reduce the company tax rate. “Even though only one-third of small businesses are incorporated, this is a great step forward.”
threat to legal aid The Law Council of Australia said an additional $80 million in funding was required in the Budget, not a reduction of $15 million. The council and has called on the government to rescind its announced cuts to legal aid and to start the process of reinstituting a sustainable funding model to ensure legal aid remains accessible to disadvantaged Australians. Law Council of Australia President Mr Michael Colbran, QC, said cuts to legal aid would “significantly impact on the capacity of already chronically under-funded legal assistance bodies to provide
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In the wake of the federal Budget, business software company MYOB explored initiatives and policies that it reckons would attract the business vote. MYOB boss Tim Reed said that surveys by his company showed SMEs want the government to make it less complex to do business, to invest in infrastructure, and to encourage business investment. Here are some initiatives that SMEs would vote for. 1. Policies that simplify the GST/ BAS reporting process – 64% 2. More government investment in transport infrastructure in major states and cities – 61% 3. Maintain the $6500 instant asset tax write-off – 58% 4. Keep the accelerated initial deduction for motor vehicles that allows small businesses to instantly write off $5000 – 58% 5. Increased funding for skills, training & apprenticeship programs – 57% 6. Government backed loans to small business start-ups – 57% 7. Carbon tax abolition – 55%. 8. More funding for innovation, research & development – 53% 9. Free government-funded training to small businesses on internet use – 52% 10. A proportion of government procurement contracts being assigned to small businesses – 50%.
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6 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2014
consider increasing gst, says vacc Rather than deliver budget cuts and reductions, why not just increase the GST?” asks Victorian Automobile Chamber of Commerce executive director David Purchase. “We were expecting a Budget of savage cuts, of slash and burn, but in reality, Treasurer Joe Hockey outlined a clear vision for the future that will not directly impact small business as much as we first thought. “However, the Motorists should not be detail has revealed penalised with higher that, indirectly, small business will be hit fuel prices ... stop as consumer confimilking them dry. dence will slacken and households have less David Purchase, VACC executive director disposable income,” Mr Purchase, said. He said reductions in social welfare, including family and youth benefits, and Medicare co-payments would cut disposable income. People would be more likely to delay buying new vehicles, or up-grading or maintaining vehicles. VACC supports the construction of the East West link in Melbourne, but is “very concerned about the impact of fuel excise increases and the reintroduction of fuel excise indexation”. “This automatic adjustment has no ceiling or expiry date, and does not take into account other economic challenges faced by small business. “Motorists should not be penalised with higher fuel prices and the federal government has to stop milking motorists dry,” Mr Purchase said.
pain and gain, say builders
UK pension changes
Master Builders Australia said there was budget pain as well as gain for builders. “Overall, the government’s road map to structural budget repair and a return to surplus should be a positive for business, home-buyer and investor confidence, despite the temporary deficit levy,” said Wilhelm Harnisch CEO of Master Builders Australia. “The building and construction industry particularly welcomes the government’s $50 billion infrastructure package, supporting $125 billion in construction work,” he said. “Master Builders welcomes the cut in company tax while recognising that many small building firms are not incorporated,” he said. However, cessation of funding for the National Rental Affordability Scheme (NRAS) made it “doubly important” for the government to find more effective methods of tackling the lack of housing supply and providing more affordable social housing.
Changes to pension legislation in Britain could have far reaching effects for thousands of Frankston and Mornington Peninsula residents. Pension proposals announced in the United Kingdom’s latest budget could prevent the transferring of UK pensions to Australian superannuation funds. The proposed changes will not affect the UK state pension, which cannot be transferred. Mt Eliza-based financial adviser and UK pension transfer specialist Peter Almond said the UK agreed in 2006 to allow anyone permanently leaving the country to transfer their pensions to overseas schemes. “In Australia thousands of people who worked in the UK and accrued pensions have taken advantage of the opportunity to transfer to Australian superannuation funds and will benefit from full tax free access in retirement from age 60,” Mr Almond said. “In the UK only 25 per cent of the fund can be taken tax free.” He said the changes were proposed to be implemented in April, 2015, “and to ensure that advantage can be taken of the current UK rules, immediate action will be required”.
end of hassle-free health care Behind the flash talk of a big new medical research future fund, the Budget signals the end of hassle-free health care,said Dr Con Costa, National president of the Doctors’ Reform Society of Australia. Australians will no longer have access to basic health care as a right, he said, adding that GPs were to be humiliated in having to become tax collectors in a complex new web of charges for patients. He said the government has moved to quarantine public hospitals with announced cutbacks to federal share of public hospital funding – and that public hospitals will be coerced into implementing a “nightmare administrative scenario – trying to collect fees fees from drunks, mentally ill, down and outers and the indigent in society”. How will states be able to continue to fund the public hospitals - even if they raise the GST to 15%?, Dr Costa asked
Mr Almond and Mornington accountants Smart Business Solutions will hold a free advice night about the pension changes at 6pm Tuesday 10 June at 328 Main St, Mornington. To reserve a place call 5911 7000 or email reception@ smartbusinesssolutions.com.au
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legal services to many Australians”. “Actuarial studies of return-on-investment in Legal Aid Commissions and Community Legal Centres have repeatedly demonstrated that funding cuts to legal assistance services are more likely to result in greater downstream costs for the economy and society as a whole,” Mr Colbran said.
June 2014 | Frankston / Mornington Peninsula / Dandenong | BusinessTimes | 7
NETWORKING gallery
1. Seaford IT business Extreme Networks joined with Acer and Intel to host a dinner at Montalto Vineyard and Olive Grove on 4 May. Guests included Chris and Cheryl Watt, of Homeport Real Estate, Hastings. 2. Wayne Gillan, of Action Coach, Seaford, with Sue Dawson (right) and Dianne Kay (left), of Paramedic Services, Victoria. 3. Frankston Wine and Food Society held its May lunch at Ranelagh Club, Mt Eliza, on 7 May. Pictured are Rob Thurley, Max Butler, Sally Riley and David ‘Bluey’ Bellette.
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4. Rosemary Gale and Allison MacEwan, of Sportproof. 5. Frankston Mornington Peninsula Local Learning and Employment Network and the Workplace Learning Coordinator Program held a breakfast at the Mornington Golf Club on 7 May where Senator Scott Ryan launched the new FMPjobs website. Frankston City mayor Cr Darrel Taylor is with David Paxino, of FMPLLEN. 6. Judy Barrett, of Morning Star Estate, with Mary-Jo Reumer, electorate officer for Dunkley MHR Bruce Billson, Minister for Small Business, 7. BusinessTimes and Extreme Networks hosted an email marketing seminar for more than 70 people at Narre Warren on 6 May. Margaret Harrison, sales director of Business Times, is pictured with Brenda Robertson, of Nature’s Blend. Photo: Biz Photography. 8. Extreme Networks managing director James Eling was the presenter for the email marketing seminar.
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9. Frankston Business Chamber ran a Buy Local Trade Expo featuring more than 50 exhibitors at Gateway Family Church in Seaford on 29 April. From left are George Petropoulos, of Digital Reprographics, Frankston City mayor Darrel Taylor, and and Dale Wyatt, of Nova Bookkeeping.
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10. Conchi Batson and Lauren Wilson, of Mornington Racing Club at the trade expo 11. Connect to Business Networking met at Vespa’s Restaurant, Carrum Downs, on Tuesday, 13 May. From left are David Anderson and Barbara Christensenn, of the Commonwealth Bank, and David Wilson, chartered accountant. 12. Networking in Carrum Downs are Stuart Young and Ellen Keble, of Hanson Young Real Estate, and Charith Cooray, accountant, of Zimsen Partners, Carrum Downs.
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13. The launch of the 2014 International Cool Climate Wine Show was hosted by Mornington Peninsula Shire Council at its Mornington offices on Wednesday, 14 May. From left are Shane Murphy, shire economic development manager, winemaker Simon Black, of Montalto, and Cr David Garnock. 14. Laurence Tedesco, of Elgee Park winery and a wine show committee member, and Stephen Robin, wine show project manager.
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15. Accountant Ron Harrison with Anita and David Hilet, of Galaxy Print and Design, Hastings, a sponsor of the wine show. 16. Frankston Business Chamber’s May networking event and annual meeting was held at The Groove Train, Frankston on 21 May. From left are Sophia Lee and Paolo Quintanilla, both of SensWide Employment, with Brett Hudson, of Pollard Insurance Brokers.
email marg@businesstimes.net.au if you have something to share.
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June 2014 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 9
NETWORKING
Steps to get back on track Not long ago, a business owner who reads my column asked me this question: I was wondering what do you do when your motivation level is lacking, as well as your self esteem? What do you do to regain the motivation needed to move on with your plans and pursue your networking endeavours? This is a great question, and here’s my answer: First of all, let me say that I am as certain of what I’m about to say as anything in my life – motivation comes from within you not from outside you. No one can motivate you but yourself. I’m speaking long-term motivation. Author Frederick Herzberg wrote about motivation in the Harvard Business Review where he said that others can motivate you but only in the short term. He called that KITA (Kick in the… Anatomy – that’s really what he called it). On the other hand, long-term motivation comes from within. So, that begs the question – as a business person, how do you motivate yourself when your motivation is low? First, you should
Dr lvan Misner*
Networking specialist
understand that virtually all people have to deal with this at some point throughout their professional lives. I’ve never met anyone that was immune to this (I certainly am not). So, what do I do as an entrepreneur and businessman when I feel down? Here are some of the things that have helped me: • Minimise contact with negative people. That’s not always completely possible but do it as much as you can. At least do this for a short while. I really believe that some people complain as though it were an
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Olympic event. Keep clear of them while you are trying to get your mojo back. • Maximise time with people that refuel your energy. You become the five or six people you hang out with the most. Hang out with people who make you want to “do” and “be” better. Set some meetings with them. Go to business events together – anything that puts positive people around you. • Read/listen/watch positive things. If you are feeling down, read a positive book. Listen to an audiobook or podcast with a positive message. Watch something that makes you laugh. Surround yourself with some things you love to be influenced by. • Prioritise the things you want to do and must do. Make a list. As a businessman, I live by lists. The more I can get a handle on the things I need and want to do – the easier it is to tackle them. • Eat the elephant one bite at a time. Take that list you’ve created and tackle some of that list every day. If you really do this, you will be amazed at how much you get accomplished. The more you accomplish,
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the better you will feel. Also, keep this in mind: if your motivation is low it helps to step out of the small picture (the day-to-day) and remember the big picture. Why are you doing what you do? Allow yourself to be motivated by your bigger vision, and let the goals drive you. Remembering why you are doing what you do in business can most certainly help you find new energy. If you’re still struggling with motivation after reading and trying the above, one of my friends, had a great suggestion: Let your to-do list (suggestion no. 4) be driven by a short term goal – what would you like to achieve in the next week or – at most – next month, that inspires you to act today? A small “win” can be very motivating.
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*Dr Ivan Misner is a New York Times bestselling author. He is founder and chairman of Business Networking International (BNI), the world’s largest networking organisation. Dr Misner is also senior partner for the Referral Institute, an international referral training company. Email: misner@BNI.com
SPICING IT UP ONLINE
CALL MARG HARRISON, 0414 773 153 www.businesstimes.net.au
June 2014 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 11
COVER STORY
BRITISH NATURALIST AND AUTHOR HAS HIS STAMP ON A PEARCEDALE CONSERVATION PARK KEITH PLATT TALKS TO MICHAEL JOHNSON WHOSE MOONLIT SANCTUARY WAS A BOYHOOD DREAM
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12 | BusinessTimes| Frankston / Mornington Peninsula / Dandenong | June 2014
Durrell also established a training centre for operators of “conservationist zoos”. “I was at that stage in my life, having done a few things [including managing boatbuilding suppliers Marine Timbers] and gone through a divorce. You could say it was a mid-life crisis. “I was 40ish and had a dream and decided it was best to do it now. I had seen people in their 40s building boats and knew they’d be old by the time they could sail [away in] it. “So I enrolled in endangered species and conservation management.” On his return to Australia, Johnson realised there were a lot of endangered species in Victoria: “Australia has the worst [animal extinction] record in the world. We’re pretty efficient at that.” Moonlit Sanctuary was to provide an insight into small nocturnal animals, the kind “many locals had never seen before”, despite them not always being uncommon in the region. “I decided I could help conserve animals and show them to people,” Johnson says. The site of Moonlit Sanctuary was chosen because it was close to 14
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erald Durrell is a famed British naturalist, conservationist and zookeeper. Before his death in 1995 he had been at the forefront of wildlife preservation for decades, fascinating and capturing the hearts and minds of animal lovers worldwide. This story isn’t about Durrell, but it would have never been written without him. It starts with him and shows how far his influence stretched, from his zoo on the island off Jersey in the English Channel, to Pearcedale on the Mornington Peninsula. His love of animals and their continued existence may help save the endangered Tasmanian devil and orange-bellied parrot.
Durrell’s ideals first fired the imagination of a young schoolboy in Mt Waverley, east of Melbourne, only to resurface years later as inspiration for a goal set during Michael Johnson’s “mid-life crisis”. Johnson’s project, Moonlit Sanctuary Wildlife Conservation Park, opened in 2001. A yearbook from his first grade sees him writing about looking after a bird. “It must have really got me and I wrote about it in class. I knew I wanted to look after animals,” he says. Gerald Durrell started collecting animals for zoos in the United Kingdom, including going to Africa. Johnson was especially taken by Durrell’s My family and Other Animals, a humourous autobiography covering four years of his life on the Greek island of Corfu. Eventually, Durrell started his own zoo and became more involved with animal conservation after realising he was supplying the same type of animals to the same zoos because of the rate of attrition. “He started the world’s first conservation zoo aimed at saving animals from extinction,” Johnson says.
A WILD LIFE
Moonlit Sanctuary operator Michael Johnson at his Pearcedale wildlife conservation park with Purple Swamphens and Pacific Black Ducks.
ACTIVITIES & AWARDS Activities at the Moonlit Sanctuary include visits by student and educational groups; conservation breeding; education holiday programs; birthday parties; group bookings and functions. Awards won by the sanctuary include the 2012 Zoo Aquarium Association’s best new exhibit under $100,000; South East Melbourne Small Business of the Year; City of Casey Hospitality and Tourism Business of the Year; 2010 Victorian Tourism Award for Ecotourism; 2009 Sustainable Cities Award for Protection of the Environment.
June 2014 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 13
cover story
A WILD LIFE
The Tasmanian Devil faces a bleak future in Tassie because of the Devil Facial Tumour Disease, first discovered in 1996. Animals usually die within months of the cancer becoming visible.
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Melbourne and the tourist routes to the Mornington Peninsula and Phillip Island. “The concept was mine, but establishing the sanctuary was done with the support of my parents.” As well as many resident animals, birds and reptiles, the sanctuary has breeding programs for six endangered or threatened species of animals and birds: orangebellied parrots; Tasmanian devils; regent honeyeaters; southern bettongs; spottedtailed quolls; and bush stone curlews. A cancer is decimating the devils in the wild in Tasmania, the number of surviving orange-bellied parrots is estimated at 50 in the wild and 300 in captivity while the quolls and curlew were once common on the peninsula. The bettongs were wiped out on the peninsula by the 1890s. Quolls were last recorded at Arthurs Seat in the 19th Century and the curlews have been extinct on the peninsula since the 1940s, their demise blamed on changes in land use, dogs and foxes. Johnson believes they could eventually be reintroduced with landowners now making their properties more suitable for native wildlife. The sanctuary’s breeding programs for orange-bellied parrots and regent
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honeyeaters are carefully managed by committees of experts and government wildlife departments. Stud books are kept and populations managed. Some of the birds have already been taken for release into the wild. Johnson estimates the sanctuary will attract 50,000 visitors this year. “Seven years ago I decided open the sanctuary during the day, and it’s been our future. “The night time is really different; daytime is more popular and I don’t really think people understood why a wildlife park would open at night. “We struggled for the first five years and then started to move ahead after opening during the day. Tourists come when they can – and it’s generally through the day, Johnson said. He decided to open 10am to 5pm seven days a week and add a cafe. “We didn’t market ourselves nearly enough in the beginning. The media only likes something when it’s new and it is only new once. “Putting more effort into marketing really paid off.” A rise in the number of visitors also followed his decision to become involved with “active marketing” – attending trade shows in Australia and overseas.
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“I was in the United States 18 months ago and met representatives of an Australian tourist business. I can’t tell if I got one or 1000 extra visitors, but we do see a lot of Americans, so something is working somewhere.” Johnson’s marketing also involves working with the local tourism body and other commercial operators. He has become as supporter of co-operative marketing. Moonlit takes out advertisements in magazines and prints and distributes its own brochures. “I’m always looking for opportunities to speak to people and go to Rotary groups and other service organisations as well as retirement villages.” Vouchers are donated to schools. Visits to the sanctuary are part of the curriculum at some schools. The sanctuary has 25 staff on its roster with a minimum two people working whenever there are night bookings. The sanctuary operates under licence and has 65 species of animals, reptiles and birds. It belongs to a zoos’ association and an eco-tourism association. “We’ve jumped through a few hurdles we set ourselves – they were higher than those set by the government.” The animals are obtained from a variety of sources, including breeders, other wildlife parks and zoos, universities and some, mainly snakes, have been pets. “We have a very professional staff of keepers – our accreditation covers that – who run the animal kitchen, preparing meals for the different animals.” Feeding the animals can involve buying frozen fly larvae, insects and rodents from specialist suppliers and making mixtures of baby breakfast cereals, honey and Sustagen. Some of Moonlit’s possums have already been seen by thousands, although the actual location of the nocturnal animals was kept a secret – they starred in a documentary about the relationship between inner city possums and their human neighbours. Filming possums on location proved too difficult for the producers while Moonlit’s “captive” actors were ready to take centre stage on cue. One of the brush-tailed possums has also played the role of a New Zealand possum in a feature film.
young entrepreneurs
Talent scout aims for togetherness So much talent, so many ideas. How to bring them together? How to harness and co-ordinate that energy and creativity? How to realise the potential? Start a startup. Or, using less jargon, put people and their ideas together under one roof. “Create a Silicon valley on the Mornington Peninsula,” Ben Acott, of Mt Eliza, says. A self-described “serial entrepreneur”, Acott has worked at Facebook in the United States and has “founded Australia’s first and largest social media marketing agency”. He has now kicked off a campaign to create “the first Mornington Peninsula startup/co-working space”. Acott says he has been working from a small space in Prahran while establishing his new businesses and recently started looking for a larger office to “cater for the launch phase” of his companies. “It suddenly clicked, there isn’t actually a need to establish facilities in the city anymore – you can work from wherever you want. We have access to amazing talent down here, much more affordable rents and a more relaxed place to do business than in inner city Melbourne.” Acott says establishing a new company just outside a major city “is exactly the
same formula as Silicon Valley was to San Francisco. Rents are cheaper for not only the businesses but the general cost of living is much lower, which is ideal when starting a new company”. The office envisaged by Acott is open plan, with hot desks or smaller areas. Shared areas would be designated for the internet and IT, boardrooms, meeting rooms, kitchens and bathrooms. Common areas and “breakout spaces” would encourage collaboration and relationships.
“You simply bring your laptop and you’re ready to go,” he says. “For companies starting out, it’s so important to be able to talk, share and bounce ideas off other entrepreneurs, even being able to benchmark or work with other companies at a similar growth stage is incredibly helpful. “My ultimate goal is to keep talent on the peninsula and to prove we have everything we need right here to run global companies. “We have the opportunity to create something special, to keep innovation local and provide exciting job opportunities for locals not normally on offer down here.” Acott said businesses ready to move onto the peninsula include his digital advertising agency Strype, a vitamin and beverage company, an online advertising platform and an online winery marketing system. “We will look to crowd fund the idea then present to [Mornington Peninsula Shire] council to contribute financial support to make this happen.” His ideal financial set-up would involve 33 per cent each coming from the shire, crowd funding and himself. To contact Ben Acott email ben@strype. com.au
Getting to the hair of the matter - online BY JESSICA HUMPHREYS
Jess Lewis dreamed of creating her own hair care range, but was delightedly surprised when the reality exceeded her dreams. When the 23-year-old hairdresser went on maternity leave she very quickly began to miss work. After a few sleepless nights she came up with the idea to develop Hair&Me, an organic, vegan hair rejuvenation treatment. “I really wanted to bring out something that I had created myself, a product where I knew what all the ingredients were and what they do,” Lewis says. “From this idea I spent all week researching alongside my husband. We tested ingredients and trialed products on
family and friends until it was perfect and did everything I wanted it to do. “We launched the website in February. We offered presales and had such an overwhelming response that the website crashed. “Hundreds of people began ordering a product they had never tried. It was such an amazing feeling.” Social media has been one of the driving forces behind the product’s success. Happy fans have been uploading their own photos of the product and their hair alongside the #hairandme hashtag. Lewis says a point of difference she has to most other online businesses is to personally respond to all customer comments and feedback. “It’s important to acknowledge your
customers. Social media allows me to build a relationship with my customers and show them that I care and that I’m interested,” she said. “It’s the same when Hair&Me is tagged in photos. I love people knowing I’ve seen their photos – I’m genuinely so thrilled to have them talking about the product.” Since the product launch, Lewis has received orders from Germany, Sweden, Brazil, London, Hawaii and the United States. Further expansion for Hair&Me has been placed on hold for a short time while she becomes a first time mum. *Jessica Humphreys operates Social Concepts, a social media consulting business. Send questions to Jessica@socialconceptsconsulting. com
June 2014 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 15
instagram: what’s the benefit? Acquired by Facebook in 2012 Jessica Humphreys* for a neat $1 Billion, Instagram is Social media consultant one of the fastest growing social media platforms. In March this year Social Media News reported that Instagram had 1,600,000 active Australian users. This is all well and good, but you are probably asking what’s in it for me? Why should I use it? We break down a few of the advantages below: • Humanise your brand/business • Instagram allows you to take ‘snapshots’ or short 15 sec videos and share them – these images should reflect your personality and your business style giving you another way to connect with a wider audience. Here are some examples: take photos of your staff; take ‘sneak peek’ or behind the scenes shots; style your new products; event photos Instagram is also a great tool to connect with other businesses. By searching industry hashtags you can find and connect with like-minded organisations or business owners. I have connected IRL (social media speak for in real life!) with many people I have originally ‘met’ on Instagram. Some of these meetings have resulted in great partnerships and friendships. We all know social media can be time consuming, but Instagram’s simplicity means it is very beneficial. It simply takes
around two minutes to upload you photo, add a filter if you choose, write up a caption and add some hashtags and you are done! Easy as that. For more information on Instagram check out the Social Concepts blog – www.socialconceptsconsulting.com/blog and follow us on Instagram @socialconcepts *Jessica Humphreys operates Social Concepts, a social media consulting business. Send questions to Jessica@socialconceptsconsulting.com
excel and data While Excel is not a database, it has Neale Blackwood* many built-in options and features Business software specialist that enable you to interrogate and summarise external databases. Pivot Tables (Insert ribbon tab) can quickly and easily summarise external databases into a tabular report layout without the need for any formulas. Pivot Tables are extremely flexible and are perfect for creating ad-hoc reports where you need to experiment with both the layout, and the content of the report. Changing the layout of the report is as easy as using the mouse to drag a field name to a different section of the report. Excel’s Data ribbon tab contains multi-level sorting and filtering features that are simple to use and allow you to re-organise and display the data to meet your needs. The filtering
Do you own a franchise? Thinking of buying a franchise? We understand you have special business needs BNR Partners are part of the Franchise Accountants Network; a national group dedicated to helping both Franchisors and Franchisees. Talk to us about how we can help you: • Assess a franchise opportunity • Set up your business wisely • Improve your financial position Jason Bertalli, Director of BNR Partners and leads the firms’ Business Service and Franchise divisions. Having over 15 years experience as Business Advisor, Jason and his experienced team work closely with businesses across Victoria bringing practical solutions and an easily understood approach to enhance the development and growth of his clients’ businesses.
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16 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2014
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CONTRIBUTOrs
features have settings that can be used to perform Pareto analysis (aka the 80/20 rule) to filter by the top, or bottom, 20% of values in a column. Another option in the Data ribbon tab can automatically remove duplicates from the database based on duplicated entries across multiple columns. Excel’s conditional formatting feature can automatically highlight duplicated entries in single columns. It also has the ability to highlight unique entries in columns.
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*Neale Blackwood owns and operates A4 Accounting. He does Excel consulting, webinars, training and coaching. Mobile: 0402 882122
John Brazzale, Managing Partner, Pitcher Partners; Bruce Le Maître from Frozen Bakery Solutions; David Knowles, Partner/Executive Director, Pitcher Partners and Gerit Knauth, Commonwealth Bank.
Some of our experts Professional solutions for the South East
Business is viewing the Federal Budget as positive because it deals with a number of structural issues to reduce our reliance on debt while providing a financial buffer to protect against any future economic shocks, Pitcher Partners’ managing partner John Brazzale said. “Clearly the government believes this is a fiscally-responsible budget because it makes a range of measured cuts, primarily in health and welfare while promoting growth and creating employment through infrastructure spending. “It’s a push for better productivity and efficiency across the public and private sectors over the long-term,” said Brazzale, who led discussion on the impact of the federal Budget on business at an update session for more than 100 business people at Pitchers’ Dandenong headquarters on 16 May. Simon Briggs, a director of Pitcher’s investment advisory practice, joined Brazzale, the former head of Pitcher’s tax consulting division, as a speaker. Brazzale said the country was looking at six years of significant infrastructure expenditure that would create significant jobs in the construction industry and downstream businesses. “In the longer term we will have better roads, rail and other infrastructure which is what our country needs.” “However, the indirect effect is that business will have to be wary of the likely increase in wages, possibly leading to wage pressures for the construction industry. This could see a flow-on effect on the cost of housing supply.” Brazzale said the unknown is the Budget’s impact on the retail, hospitality and tourism and travel industries as a result of any detrimental impact on consumer spending because of introduction of indexation of petrol and an increase in the fuel excise. “There are significant taxation measures still to come for business in the government’s white paper to be released end of this year, but the overall feeling is that this is a budget that invests for the future and the long-term,” Brazzale said.
Pitcher Partners, a leading Melbourne accounting, audit and advisory firm, has been helping businesses like yours for more than 20 years. And now, we have an office in the South East Region to provide practical business advice and professional solutions in a location that’s convenient to you. For more information contact David Knowles or Vicki Macdermid on
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June 2014 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 17
HEALTH
I’ve got a few things going on “I’ve got a few issues, but I’ve really come here today about my neck. It’s so tight I can hardly turn it.” “OK, sure. What else is bothering you?” “Look, the neck’s the main thing. And I’m getting some indigestion and pain under my ribs here but my doctor thinks it’s probably gallstones, so she’s referred me for a scan and recommended I stay away from fatty foods. Otherwise I might need my gallbladder out. My husband had his removed last year and he’s fine now.” “Anything else?” “Well, I’m always having trouble with my right hip but that’s not related to the neck. I’m seeing a specialist about that next week. Apparently they can inject your own blood into the muscle and it fixes the problem so hopefully I won’t need a hip replacement. Anyhow, my neck is killing me. The physio thinks it’s the way I carried my schoolbag.” “Really? Twenty years ago? OK… Any headaches?” “Yes, I’ve had two this week right here in the temples, but I think they come from my neck. The chiro thinks I need a new pillow.” “And how does your back feel?” “Oh, my mid-back area is always tight – but that’s normal for me. If you can just fix my neck...” Some variation of this conversation takes place daily in clinics across the land. In the West we think of our bodies as being like complex machines, with parts that run pretty well independently but wear out with abuse or over-use and then need repair or replacement – and that once that part is restored, good as gold! We have few explanations for the relationship between body parts that would connect a sore neck, for example, with hip pain, with temple headaches, with indigestion, with rib-side tension, let alone the insight to explain how one person’s gallbladder problem being reflected soon after in their partner’s could be anything other than coincidence (beyond that they might share a high-fat diet which, by the way, is not the cause of gallbladder disease). No, instead, we see each ailment as a separate issue, requiring the attention of a different health professional. One good reason for this is that Western
Michael Ellis*
Chinese Herbalist
Really, no-one in the Western system is effectively joining the dots. medical knowledge is so vast and complex that it’s impossible for one doctor, no matter how brilliant, to hold the entire system in his head while consulting a patient. Many idealistic young medicos find this challenging; to not have all the answers. They signed on for medicine so they could help everyone. So early in their careers they specialise and move into areas where it is possible to know everything medically useful, and to hold all that knowledge front of mind during a consultation – to be the expert about hips, or gallbladders, or whatever other part. The result is a fragmented, unwieldy, expensive, “health” system. Apart from a dedicated but time-poor GP at the bottom of the medical food chain, no-one even attempts to make – and I use this word reluctantly due to its overblown new-age connotations –
18 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2014
wholistic sense of their patients’ signs and symptoms. Really, no-one in the Western system is effectively joining the dots on a person’s physical, mental and emotional health, on the factors in their lives that are making them sick. The focus is way too fine to do so. Western medicine is too busy peering into microscopes, or scanners, looking for abnormalities at a cellular level. (Or looking at population studies.) Once it discovers such abnormalities, it feels on firm ground to diagnose a patient as having X disease, then to pack them off to the specialist, who confirms or refines the finding and then provides treatment (which research, probably sponsored, suggests will be X per cent effective for X per cent of patients). Western medicine’s great weakness, in my view, is its inability to step back from these test results – and disease labels – and to understand and describe patients’ health in the broader context of their lives. The West still grossly underestimates the impact of lifestyle on health, and particularly of the emotions as causes of internal disease. It fails to see connections that for Eastern medicine are exercises in simple, rational logic. Addressing the patient complaining of the sore neck – and hip pain, and indigestion, and headaches – Eastern medicine is already thinking about a systemic pattern of disharmony that needs attention before anything but temporary relief is likely. So a “neck” treatment will entail work on the back, and limbs, on particular areas and points that Chinese medicine has come to understand is directly connected with the neck (and digestion, and hip, and temples, and certain emotional states, etc.) More than that, Eastern medicine also considers its role to be to explore the aspects of the person’s lifestyle that have brought them to this point, and to counsel patients accordingly. Sometimes that is challenging for practitioner and patient (people are manylayered!) but other times so simple and obvious that it’s breathtaking when Western medicine overlooks it. “OK, let’s have a look at this neck.” *Michael Ellis is a registered Chinese herbalist in Mt Eliza. Visit www.mtelizaherbal.com
MARKETS
Banking on perpetual optimism CBA’s quarterly 21% profit lift spread quiet satisfaction across the country. For those buying in the early nineties at $7-8, this is now a “ten bagger” – a ten-fold lift with rising dividends almost all the way. True, there were some hair-raising moments in late 2008 when CBA plunged to $30, but it has been largely up ever since as the other Big Four gathered strength on the back of a government credit guarantee and the re-opening of international credit markets. The perfect storm of the CFC turned out to be a near perfect calm as the US Federal Reserve cut US rates to zero while China unleashed a massive stimulus program when 15-20 million workers were laid off. The insolvency crisis in the US turned out to be a short-lived liquidity blip on our shores when bank run fears were quickly removed by the guarantee on bank deposits and on bank debt. This allowed the majors to work the leverage handed to them preferentially over the smaller lenders and obtain the longer term cost reductions that prior investment in cross bank platforms provided. While there is still a large amount of paper handling behind the scenes, all banks are inching closer to becoming virtual operations as customers migrate to internet transactions and now largely mobile ones. This has come as a technological windfall of immense value. Apart from cash takings and transactions for the over seventies, many branches are close to redundant. Mortgage lending under Australian conditions and regulations also offers low default risk and commercial lending is tightly watched. The days of lending to big hitting entrepreneurs are well and truly over. Loans to small business are always backed by
Richard Campbell* Stock Analyst
property, usually the home, and while there were some blow ups in the mining sector, largely contractors, the credit climate has been very benign. CBA may have led the way in looking in the other direction as rogue financial planners plundered, but this stain seems to have been airbrushed out of existence as a middle management issue. In fact banking has been so free of pain that profits were enhanced for a second year by reducing provisions for bad debt. Against this background it comes as something of a surprise to see that several of our leading bank analysts are warning of the dangers of “permanent optimism” and “bubble valuations”. They fret and grizzle, but our economy is not stressed and if provisions set aside in 2008-10 were excessive, isn’t it reasonable or even a duty of directors to return cash to shareholders? Inflation is low, the property market seems sound and if there is a risk that property values will retreat as China slows, it would require a very substantial fall in property values to impact bank loan valuations. Bank bulls can also point to the prospect of rates staying near zero in the US for perhaps another two or even three years. That means cheap funding for our banks and all things being equal that’s a good thing. But the reality is that low interest rates
are symptom of malaise, not of growth. As in Canada and the UK, rising house prices become a risk for the banks if they are driven by scarcity or the absence of alternative investments. They are bubble or near bubble if they prices rise faster than incomes and are driven by low debt. This is now the case. Home prices are ticking up quickly and at 4.3 times average ages they are well above the long term ratio of three times. Household debt has surged as well. It is now at a 20 year high at 111% of average income. None of this need be perilous if the surrounding economic framework was benign, but it is steadily becoming less so. China, our largest customer, is slowing and its multiple Ponzi schemes are beginning to surface. Local government lending agencies have piled up debt of US$3 trillion constructing infrastructure projects and speculative housing, often either surplus to demand or not supported by adequate cash-flow to service debt. Many cities are borrowing to pay interest on project loans. Property developers are also beginning to discount stock ahead of what could be a selling avalanche. The rich and/or corrupt often have multiple apartments well beyond their salaries could afford. This is not good news for us. China’s construction market consumes about 65% of its steel. This means iron ore prices are likely to slip over the next three to four months. A dip to $90 would see a changed attitude to Australia and a demand for higher loan rates. This could happen quickly, but more likely slowly like a long fuse burning. The problem is that it is quietly burning now. * Richard Campbell is Executive Director of Peninsula Capital Management, Tel. 9642 0545. rcampbell@peninsulacapitalmanagement.com.au
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interviewing
Where do these questions come from? Online jobs platform OneShift has sifted through the results of a survey of job seekers, to find the 20 most bizarre questions Aussie employers have asked in an interview. Tough questions are generally the norm in any interview process, but increasingly, more companies are adopting the Googleesque style of gauging a candidate’s thinking style, by asking brain-teaser questions or questions that are aimed at determining the jobseeker’s personality. Survey respondents said they were asked left-field questions like “name the dwarves from Disney’s Snow White” and “are there wolves in Australia” alongside some equally oddball requests such as “would you wear a Sombrero at the airport so company guests could easily identify you?”. A Western Australian man who was surveyed said in his 40 odd years of being
Many employers are using these oddball questions to suss out if the candidate is quick on their feet – Gen George, CEO and founder of OneShift employed, one particular question interviewers tend to ask is a double edged sword that he feels intimidated by. “I’ve been asked a few times how I’ve dealt with conflict. It obviously reflects well when you’re able to tell a story that shows how you successfully dealt with the situation. The problem arises when you describe a scenario that you assume you handled well, but the interviewer may think otherwise. Or, if you choose not to give an example, you’re seen as someone who can’t handle conflict.” Gen George, founder and CEO of OneShift, said in most cases, the process
of getting to the answer is more important than the actual answer itself. “Many employers are using these oddball questions to suss out if candidates are quick on their feet. They’re looking to get a feel for analytical thinking skills, how you respond under pressure, and what your general view of the world is. The trick with dealing with such questions is to take your time. The interviewer doesn’t expect you to have the answer at your fingertips, because it’s not a question like ‘tell me about yourself’ which candidates are familiar with and expecting. “Staying calm and attempting to explain the steps you’re taking to solve the question,
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during pick-up? 11. Are there wolves in Australia? 12. If you could be a type of animal, what would you be? Why? 13. You have several hundred kilos of cardboard boxes. With a group of 10 people under your command, how would you delegate the tasks to move the boxes from point A to B which are 1km apart? 14. If you were a car, which would you be? 15. If you inherited an island: - What would you do with the island? - Who would live with you on the island? - What would be the top three rules of the island? 16. What would you prefer to get out of working with people? - friendship; - productive working relationship; - new partner. 17. What fruit best describes you? 18. What ice-cream flavour would you be? 19. What TV personality best describes you? 20. What’s your favourite colour and why?
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June 2014 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 21
MANAGING
Keeping your values alive The very first article that I wrote four years ago for the Business Times was on organisational values because I know that shared values are the foundation for every organisation. Unfortunately, our recent media has been filled with too many examples of failed values within political and business organisations, and at a personal level for too many high profile people. State premiers, government ministers, performance artists, business leaders have all fallen on their swords in recent months because of their inabilities to comply with their organisations’ values. All these public failures remind us that we must work hard to keep our values alive and well every day. Let’s start by revisiting some basic concepts about organisational values. Every business leader needs to identify the few important behaviours that will shape people within their organisation and then rigidly define these as the boundaries within which everyone must operate. Some of the most popular values include treating people with dignity, focussing on customers and caring for the environment. There are however, literally hundreds of concepts that can be embodied as values and adapted to suit any particular business. These can be developed using either a top down or bottom up process of discussion. In the top down process, the business leader can decide on the best values, perhaps in a dialogue with directors or their direct reports. In the bottom up process, the dialogue can start with input from everyone in the business and finish with the leader massaging the collective inputs into a final set of values. Either way, a final set of values is developed and these now become the behavioral standards for everyone in the business. In many ways this is the easy piece – living the values is the hard piece. The leader has to take on the role as steward for the values where they know that the real benefit from a strong set of values is to improve the effectiveness of the organisation to execute their vision and strategy. Throughout any organisation, there are hundreds of decisions taken every day at every level and a strong set of values will help to ensure that the optimum decision is made every time. Without strong organisational values, every person will make decisions based on their own personal
Hamish Petrie*
Business Consultant
values and beliefs and there can be major differences between people that can lead to chaos over time. In living the values, the most important person is the business leader. People working within a business always want to believe that they are working for a great leader who they can admire. However, unfortunately, cynicism abounds and people are quick to find fault with their leader when their behaviour strays from the ideal. As a business leader, the challenge is to stay on track and control your behaviour to the extent that you are seen as role model for the organisation. Too many times, there have been high profile examples of leaders that have not “walked the talk” with the result that they have lost personal credibility which has subsequently led to personal and organisational failure. As a business leader, your behaviour is always on display, so small aspects of your behaviour are watched to see just how well you comply with your values. While it may not be too difficult to comply with your values in normal circumstances, it is your behaviour when under stress that often communicates most vividly. All of us have both a dominant style and a back-up style that we show only under stress. It is the back-up style that will be judged most harshly by our people, so be very careful about how much your behaviour changes when subjected to the real stresses in your job. Effective leaders seek out opportunities to reinforce the values every day. This requires a willingness to identify both good and bad examples of behaviour and to make them very visible throughout the organisation. While this is relatively easy with good examples, it can be more challenging with examples of bad behaviour. In the
22 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | June 2014
extreme case, people who choose to ignore the organisational values must be excised from the organisation and it is best to do this very publicly so that everyone can understand the critical importance of the values. It is also important to recognise that values are very different to ethics. While values and ethics can overlap in setting behavioral expectations, they are not necessarily aligned. Ethics are based on legal and moral standards while values are fundamental beliefs that define an organisation and these may not align with ethics. In fact, some of the organisations with the strongest reinforcement of their values are criminal organisations that often have unique methods to enforce their values. Your organisational values have to be widely understood not only by your people, but also by your suppliers, customers and other business partners. Having your values written down and displayed on walls is a significant step, but the real communication comes through the behaviour of your people. Gaps in behaviour by any of your people who deal with these external groups will quickly stimulate skepticism and cynicism about your business. This can lead to a worse outcome than if you had never communicated on your values. Overall, values will be kept alive when they are reinforced daily by the words and actions of the business leader, so take every possible chance to communicate these expectations throughout your organisation. Have you done this today?
Action Planning Questions: 1. Does your organisation have well defined set of values? 2. Does your business leader demonstrate the values by publicly recognising examples of both good and bad behaviour? 3. Are your current values resulting in the optimum outcomes with aligned decision making throughout your organisation? 4. How well do you control your back-up style to ensure compliance with your values? *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 2014
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