Let’s Talk Business
Let’s Talk Business Back To Basics Business Solutions - Support for Small Business
Volume 2 Issue 22 - September 2014
Online Complaints Can Make or Break a Business! Should they be allowed? Inside this issue
Cover Story - Online Business Complaints ...….2
Five Simple & Powerful Ways to Boost Productivity Dr Tim Baker …..….............3
Biz Snippets …………….......4
Do You Conduct Regular Competitor Research? Dennis Chiron………...........5
Business Plans are a Waste of Time Geoff Butler ………………..6
How are my Millionaire Clients Different? Dan Buzer ……..…………...7
6 Things That Google Looks For in a Website Karen Ahl ……..………..….8
Small Business & Your OH&S Obligations Tony Osmani …..…….…....9
Benchmarking and the ATO Jo-Anne Chaplin………….10
Transition to Retirement VS Salary Sacrifice .. In Plain English Paul Gillmore ………….. ..11
Editor’s BizTips ……….….12
LTB Objectives …..........…13
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Let’s Talk Business
Should you be allowed to complain about businesses online? One man doesn’t think so Frank Chung from news.com recently wrote an article regarding customers being able to complain about poor service or products online. Frank stated: “In a time when anonymous reviews from disgruntled customers can make or break small businesses, one man is on a personal mission to bring some positivity back to the internet.”
Kudos2 is only three months old and Mr Ryan isn’t sure when it will turn a profit. Around three hundred businesses have been given ‘Kudos’, and the site has around 200 registered users.
Paul Ryan, head of marketing company Intouch group and co-founder of the company formerly known as Wizard Home Loans, is the behind a new venture called Kudos2. It’s an online testimonial service in the vein of UrbanSpoon or Yelp, but with a fairly significant catch — you’re only allowed to post positive feedback. “Service is subjective,” Mr Ryan explains. “One man’s drink is another man’s poison. What could be good service for you might not be good service for others.” According to Mr Ryan, sometimes “people have bad days” and while your grievance may be legitimate, it’s unfair to publicly sledge a business without first giving them the opportunity to rectify the issue. “Today we’re very quick to jump on negativity, but I think we should be rewarding effort. If you post a negative review online, it just breeds more negativity.” Mr Ryan hopes people will use Kudos2 to share positive service experiences, and others will make their judgement based on the number of recommendations a particular business has. “Say you wanted to move to Port Macquarie — you’ll need to find a real estate agent, an insurance broker, a dentist, a nice coffee shop,” he says.
“There are 1.4 million businesses out there with fewer than four employees. These are businesses that don’t have huge marketing budgets, so the question is how do they get themselves known in the wider community?” “We want people to be able to jump on Kudos, type in ‘Port Macquarie’, and see all the businesses that have happy customers.”
However, on the ‘flip-side’ Matt Wade senior journalist from “The Age” believes that the vast majority of customers fail to complain about poor service or treatment, and are prone to suffer in silence.
It all sounds lovely, but it begs a fairly obvious question — what if a business just isn’t up to scratch? Don’t customers have a right to warn off others if they believe they’ll have a bad experience?
Matt writes: “A 2011 survey conducted for the Australian Communications and Media Authority found that 76 per cent of those who contacted their communications provider with a “When a customer has a bad experience, grievance did nothing more about it.” they want one of two things — they either want to vent, or they actually want So why are so many consumers so something done about it. If it’s the passive? One reason is what behavioural second one, the best people to speak to economists call “loss aversion” – the tendency for consumers to care more are the businesses themselves.” about preventing a loss than making a And if it’s the first one, Mr Ryan would gain. prefer it was done the old-fashioned way — having a whinge to your mates at the BBQ, rather than putting it up on Facebook where thousands of people can potentially see.
Conversely, there is a website dedicated to nothing else but harvesting complaints: “Crappy Customer Service” claim to be Australia’s largest complaint site, and they claim to have received “Seventy per cent of people are now over 13,000 complaints in the past 4 researching online and trusting years. recommendations they find — there’s still Facebook, Yelp and the rest. They What do you think? Do you agree with can see all the negative reviews there as Paul Ryan? well, and they’ll make their own decision.” 2
Let’s Talk Business
Dr Tim Baker Managing Director WINNERS AT WORK Pty Ltd
www.winnersatwork.com.au www.about.me/tim.baker
Five Simple and Powerful Ways to Boost Productivity
tim@winnersatwork.com.au
Telephone. +61 7 3899 8881
Editor’s Note: Dr. Tim Baker is an international consultant, successful author, keynote speaker, master trainer, executive coach, university lecturer and skilful facilitator. In a nutshell, he has conducted over 2,430 seminars, workshops and keynote addresses to over 45,000 people in 11 countries across 21 industry groups. What are some relatively simple ways of increasing profits by 30 per cent without firing anyone or spending any money? Here are five simple and powerful ways of doing this. Even if you only applied one of these strategies your personal and organizational productivity would be significantly enhanced and so would employee morale. The biggest time wasters in organizations from my observations over 18 years across 21 industries are spending unnecessary time on email, attending mindless unproductive meetings, conducting performance reviews; indulging in too much fake work, and administering surveys with no follow through. There are doubtlessly others, but these five are covered in this short article. 1. Do an email audit How much time do you spend daily on compiling and reading emails? Too much time? Why don't you find out exactly how much time? Keep a log for three days on when you attend to emails. Get your staff to do the same. Then work out an average amout of time per person across the business. Multiple that average time per week by the mean weekly wage by 52. This gives you the total cost of using email annually across the business. Then multiple that by two to
compensate for the lost time not doing other more productive business activities. The number will scare you. Then set up an email protocol and ensure that employees and managers follow it. If you can reduce the amount of time on email by 25 per cent would that make a difference to the business's bottom line? 2. Reduce the number of procedural meetings Like emails, do a meeting audit. How many meetings do you attend each week? What percentage of your time is spent sitting in meetings? More importantly, how many of these meetings are a waste of your time? I am all for increasing the quality of communication in a business. But it is often the mindless procedural and reporting meetings that occur once a week that are time wasters. Meetings are costly. Six people in a room for a one hour meeting can cost the business $850 to $1,200. You need to be able to justify that expense. A 20 per cent reduction in these kind of meetings can save a business thousands, tens of thousands or hundreds of thousands of dollars a year, depending on its size. 3. Replace performance appraisals with performance development Performance reviews are a waste of time. There is no empirical evidence I know of that demonstrates conclusively that increased performance results from the dreaded performance review. A better focus is on short, regular, focussed conversations around performance. The Five Conversations Framework is such an approach. At any rate, there needs to be a shift from appraising performance to developing performance. 4
Stop surveying people and start listening Organizations spend thousands of dollars a year conducting a variety of online surveys assessing levels of employee engagement. Ironically, getting staff to
complete the engagement survey is often the only form of engagement! When the results are collated they are generally discussed at the senior management level and little else happens. More time ought to be spent on discussing the results with staff and less time asking them to fill out these surveys. 5. Eliminating fake work Peterson and Gaylan wrote a thought-provoking book called, "Fake Work". Their general argument is that we spend too much time doing what they refer to as fake work; that is, work that isn't directly or even indirectly linked to the strategic direction of the business. They believe that a small percentage reduction in fake work will lead to significant productivity across a large organization. Using the time-honoured 'To Do List' can help in this regard. These days you can complete a To Do List on your smart phone. And remember: writing the list itself is not the point. It is the prioritization of tasks and the adherence to that list that makes all the difference. Imagine for a moment if everyone in your organization was committed to correctly using a To Do List every day. What difference that would make to eliminating fake work? There are doubtlessly other ways of increasing productivity that are cost effective and I would love to hear some of these from you. But as I mentioned at the outset, if you only committed to one of these ideas and followed through, it would make a profound difference to the productivity across the business you are working in. ďƒž 3
Let’s Talk Business
HUMOUROUS SIGNS
Business Posters that you don’t see in the office Rome did not create a great
empire by having meetings...they did it by killing all those who opposed them. If you can stay calm, while all
around you is chaos...then you probably haven't completely understood the seriousness of the situation. Eagles may soar, but weasels
Me next!” says the sales rep. “I want to be in Hawaii, relaxing on the beach with my personal masseuse, an endless supply of Pina Coladas and the love of my life.” Poof! He’s gone. “OK, you’re up,” the Genie says to the manager. The manager says, “I want those two back in the office after lunch.” …… Moral of the story: Always let your boss have the first say.
don't get sucked into jet engines. Artificial
Intelligence is match for Natural Stupidity.
no
Says
A person who smiles in the face
of adversity... probably has a scapegoat. A bird in the hand is always safer
than one overhead. A bird in the hand makes it hard
to blow your nose. A clean tie attracts the soup of
the day. A closed mouth gathers no foot.
And the Moral of the Story is ….. A sales rep, an administration clerk, and the manager are walking to lunch when they find an antique oil lamp. They rub it and a Genie comes out. The Genie says, “I’ll give each of you just one wish” “Me first! Me first!” says the admin. clerk. “I want to be in the Bahamas, driving a speedboat, without a care in the world.” Poof! She’s gone. “Me next!
A wealthy man requested an old scholar to wean his son away from his bad habits. The scholar took the youth for a stroll through a garden. Stopping suddenly he asked the boy to pull out a tiny plant growing there. The youth held the plant between his thumb and forefinger and pulled it out. The old man then asked him to pull out a slightly bigger plant. The youth pulled hard and the plant came out, roots and all. "Now pull out that one," said the old man pointing to a bush. The boy had to use all his strength to pull it out. "Now take this one out," said the old man, indicating a guava tree. The youth grasped the trunk and tried to pull it out. But it would not budge. "I – It's impossible," said the boy, panting with the effort. "So it is with bad habits," said the sage. "When they are young it is easy to pull them out but when they take hold they cannot be uprooted." The session with the old man changed the boy's life. 4
Let’s Talk Business Dennis Chiron Marketing Means Business 0451 184 599 www.marketingmeansbusiness.com
dennis@marketingmeansbusiness.net.au Skype: dennis.chiron2
DO YOU CONDUCT REGULAR COMPETITOR RESEARCH ? An essential tool in any business's toolbox is a clear idea and understanding of reality. Reality? What's that?
differences than you think. And you must ensure that you must outshine your competition in all areas. Note especially when they do their followup. Make sure that you can do it faster.
Reality is the difference between the way you are conducting business 2. Visit your competitors. You compared with the way your personally, or one of your most competitors are conducting their trusted people should pay a visit to business. the premises of your competitors. The ultimate goal is to do absolutely Note the little details that win or lose everything better than your competitors. potential customers. But how do you accomplish that? The 3. Phone your competitors. Focus on answer is: by spying. the personality and attitude of the Successful business owners ensure that person who answers the phone. If it's they thoroughly research their warmer and more friendly than the competitors, their industry, and person who answers the phone in especially, themselves. your business, then train your person to excel in this role. Just realize that business information is more available now than ever and that 4. Make a request for something. your competitors are “on the ball”. Maybe it will be a price list or a brochure. See how your request is They're getting smarter every day, and fulfilled, concentrating on speed and the only way you're going to know how follow-up. Do you handle requests as you measure up to them is by actively professionally as your competition? engaging in regular spying. Competitor ‘Fact-Finding’ is a painful 5. Compare and assess. Look at your own business through the eyes of job, especially when you learn that you your customer and compare your and are falling behind, but the opportunities your competitors' service, pricing, to make your business the best make up packaging, people, product selection, for the pain. follow-up, signs, quality, delivery Here are five suggestions to help you and attitude. Only thorough research get the best out of your Competitor will give you honest feedback Research: on how you're doing. 1. Order something. Buy something 6. Buy something. It always helps you from some of your competitors. Do to own the product or use the service it by phone or mail or in person. of your competitors, because it Keep a watchful eye out for the enables you to spot your own smooth or rough edges in the entire weaknesses as well as your own process. There will be more strengths.
Be prepared to have to face up to some home truths about your business. Of course, there's a chance that you're doing everything better than your competitors, but if you research (spy) properly and learn from your espionage, there's a great chance. Once you've completed your research, react to what you've learned and be committed to improving. Of course, a nicer term for this activity are words like Competitor Analysis; but no matter how it is phrased or worded, it boils down to be totally aware of everything your competitors are doing. Remember, many of the best companies in the world remain at the top of their game by keeping a very close eye on their competitors. Strategic competitor analysis is an excellent way to obtain information about important competitors and use that information to predict competitor behaviours whilst making better business decisions. In my own capacity, both as a business owner and a consultant, I am often surprised that small to medium business owners neglect to analyse their competition. It is so important to know who and what you’re competing with. Can you imagine that Microsoft doesn't know what Apple is doing in terms of its product development and market share, or vice versa? 5
Let’s Talk Business
Geoff Butler FAIM AP, MAITD MACE Principal/Business Improvement & Implementation Specialist Business Optimizers
Business Plans Are a Waste of Time
Mobile: 0414 943072 Fax: 3036 6131 Email: geoff@businessoptimizers.com.au Skype: business.optimizers1
I know it’s a bit controversial for someone like me who works as a Consultant to SME businesses to make this statement, but for most business owners it’s the absolute truth. Having worked as a business improvement and implementation specialist to businesses in virtually all industries for over a decade, the absolute truth of the matter is that most business owners spend a lot of time and effort developing business plans which then sit on a shelf and gather dust. If this is the case they have simply wasted their time and should have carried on and just hoped they had the right game plan. It will be the dearest coffee table book they’ve ever bought, and they had to write it themself. Ricardo Semmler, the author of Maverick and The Seven Day Weekend said ‘The best thing about not planning is that failure comes as a complete surprise, and isn’t preceded by a period of worry and depression.’ It’s actually one of my favourite sayings. Over the years I’ve seen hundreds of Business Plans, most of which have been written to convince the bank that the business will make enough money to pay back the loan they gave them to get it started, or
for that next major expansion. They are unrealistic expressions of hope that highlight the strengths of the owners and their team, as well as the opportunities of the venture, whilst virtually ignoring the weaknesses and threats in the business and market in which they operate. What people fail to realise is that banks in Australia have been reading business plans for about 150 years, and chances are they have seen better fables than you’re trying to spin over the years. They will spot an unrealistic business plan in an instant, because they’ve seen lots of them. They’ll probably still give you the money but they’ll make sure they have security over your house before they do. You probably sense I’m a bit jaded by the whole business planning concept, but that’s just not true. A balanced Business Plan that is well implemented and regularly reviewed is probably the most valuable bit of intellectual property in your business, but the truth of the matter is that to find one that is realistic, implemented and reviewed is incredibly rare. In small and even medium sized business there is absolutely no point in an 80 page document that nobody is going to read. You need a short punchy document that has a few key features such as a comprehensive
Strength, Weaknesses, Opportunities and Threats (SWOT) analysis from which the strategies have been developed that will lead to the agreed objectives and ultimate goal of the organisation that also need to be documented within the Plan. It should also be accompanied by robust budgets for profit, cash flow and capital expenditure requirements. In my experience these Plans are rarely more than 15 to 20 ages in length. The most important step once you have completed your shiny new Business Plan is to develop your Implementation Plan. This is the step that most business owners fail to complete and yet it is almost as important as developing the plan in the first place. The Implementation Plan breaks down the strategies contained in the business plan, prioritises them, and then breaks them down into individual tasks, allocating them to a person, and timelines when they must be completed. In effect it turns each strategy into a Project Plan which is solely focussed on achieving the objective to which it is linked. If you just have a Business Plan without an Implementation Plan, I would suggest you’re just wasting your time.
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Let’s Talk Business
Dan Buzer Profit Mechanics 0414 567 188 www.profitmechanics.net/ dan@profitmechanics.net
“… How Are My Millionaire Clients Different to My ‘Want’ To Be Millionaire Clients? …” I spent an intensive ½ day with one of my millionaire Clients last week. After our meeting I offered to drive him over to another of his business sites. On the way back to my office I took a moment to think about how he and my other successfully wealthy Clients are different to my not so wealthy Clients. Here’s what I came up with …
They’re not big users of Facebook, Twitter, Pinterest and other social media tools. They have people manage those tools for them (very well), but are not into it themselves. They’re prolific uses of the phone, as are their friends. Their phones are almost constantly ringing. They use emails to help lead into conversations on the phone (which lead to business), to transfer information and to have documented records. They spend their lives ‘solving problems’. Nearly every word out of their mouths revolve around identifying, solving or reflecting on the solving of a problem of some kind. Problems with tenants, staff, sales, marketing, cashflow, supply, product quality, efficiency, etc. The number one difference!? They are PRODUCTIVE! They generally hate (and I know that’s a strong word) wasting time on fluff, crap and maybe’s. They
mean what they say and get things done. If they need more sales, they go and get them. Full stop! Lastly, they love leveraging by using experts in their field. They don’t see it as a cost if the expert gets them the results they want.
My millionaire Clients are also passionate! They generally love what they do. They’re products and services are an extension of them. They’re busy people, but they don’t see it as work. If they didn’t work in/ on their business, they would be busy doing something else. They are also forward thinkers, community aware and family conscious. Some of my Clients could comfortably (very comfortably) retire and live off their current income streams. However many of them are driven by the idea of leaving a legacy and an ongoing opportunity for their family, employees and even their suppliers & customers. My ‘not so financially successful’ Clients have some commonalities as well …
They often get distracted by bright and shiny objects, new ways of doing things and promises from other people who are not successful. They don’t know how to accurately measure where they are in terms of what results they’re
aiming to get, what they’re progress is to achieving results and how to get back on track quickly without losing momentum. They use their time to save money, rather than use money to save time. They see spending money as a risk because they often don’t have past experience to learn what to spend money on. They sometimes get distracted from the ‘learning experiences’ on their journey to getting the results they want.
I asked some of my successful Clients what their suggestion to those who would like to be successful. They’re answers were surprisingly similar. “Learn to be the leader of a smart Team. If you’re the smartest person in your business, you’re probably doing things harder than you need to be”. I hope these ideas help you to either identify why you may be achieving your goals, or not. Mention this article for your copy of the Profit Mechanics Sales & Marketing Diagnostic Questionnaire along with a 30 minute phone chat to help guide you through the tool and apply your business objectives to it. Remember … Business is More Fun, When There’s Profit! 7
Let’s Talk Business Karen Ahl Bac. Bus (Mark, Man), TAE40110, Cert IV IT Caboolture, Queensland Ph 0415 142 178
www.web-sta.com.au
6 things that Google looks for in a website When planning for a website, it is important to keep Google in mind. 1. Your Domain Name EXAMPLES: www.yourbusinessname.com.au, www.whatyouoffer.com.au or www.yourindustry.com.au Consider branding, simplicity and keywords. Think about… Using your business name as your domain name
Memorability & spelling The keywords you want to rank for Aim for your business name, your main keyword or both in your domain name. If you already have a domain name that doesn’t do this, don’t panic! There are many other ways to ensure your website ranks great. 2. Your Wording This is possibly one of the most important things Google looks for. Take your time. The saying, “Content is King” is relevant. Google makes regular updates to how they rank websites. The freshness, the quantity and the quality of a websites’ wording is important. This is why BLOGs are so popular! Think about… What do you want to rank for? E.g. Brisbane Catering What areas do you service? E.g. Brisbane, Chermside etc What services/products do you offer? E.g. Event Catering
Include all of this in your website wording. Do not repeat your keywords too much and don’t copy and paste wording from another website. You may get penalised for spamming or duplicate content. 330+ words per page, keep sentences short, use dot points and bold some of your keywords. Also make sure it is readable too. It is a balance between keeping Google and your audience happy. 3. Your Images ALT Tags Otherwise known as “Alternative Text Tags”. Alt tags were originally designed for the blind where a program would read out the wording on a website. The Alt tag would serve to describe any photos. Most DIY website software provide fields to complete these Ask your website designer if Alt tags have been added to your site If you don’t have any images on your site…consider adding some You can usually see ALT tags when you hover over an image. 4. Title & Description (Meta Tags) This is what is shown in Google Searches!
Screen Shot: Google search for “Bribie Island Electrician”
Some guidelines… Title = up to 72 characters long Description = 150 - 160 Using just your business name or
the default page name (e.g. Home) as your Title tag is a waste of time Your Meta Tags must compliment your page wording for max. effect. Each page can be different to better match that page’s wording
5. Existing Traffic A crowd attracts a crowd How to get more traffic… Send an email to your contacts inviting them to click on a link to your website Post a link on Facebook etc. Add your website address to your email signature & advertising 6. Download Speed How fast does your website load? Things that effect a sites speed… Image size – the bigger they are the slower they will load Other background programs, coding, applications etc. Website hosting speed By ensuring that images are only as big as they need to be, that background programs are not too complicated and the quality of your hosting. While we don’t have control over the speed of the internet connection of those visiting your website, taking care of these few things can radically improve the chances of them loading your website in full. We will go through 6 more things that Google looks for in a website. For further information, please feel free to email Karen ~ The Webgirl. 8
Let’s Talk Business
Tony Osmani C.E.O. Tell : 1300 421 914, Mob: 0411 09 5539 tonyo@abrasydney.com.au
Small Business & Your WHS Obligations
Small businesses account for more than 95 per cent of all Australian businesses and are responsible for the health and safety of approximately 4.8 million workers. State and territory work health and safety regulators have developed resources to assist small business owners understand their work health and safety obligations. Resources include access to free advisory services, information sessions, fact sheets and tools. Under occupational health and safety (OH&S) and new work health and safety (WHS) legislation you are obliged to provide: safe premises safe machinery and materials safe systems of work information, instruction, training and supervision a suitable working environment and facilities.
Complying with these duties can prevent you from being prosecuted and fined, and help you to retain skilled staff.
Legislation requires you to notify or give notice to WHS in your State, of various activities, including work incidents. Notify WHS in your State about a work health and safety incident You are required by law to report certain workplace incidents if they arise out of the conduct of a business or undertaking and result in the death, serious injury or serious illness of a person or they involve a dangerous incident. In an emergency In an emergency dial 000, do not touch the scene other than to administer first aid. Contact Work Safe Australia on 1300 551 832 After a death in the workplace
A death in the workplace is always Workplace health and safety authorities investigated to find out what happened in each state and territory and Safe and to determine ways to prevent the Work Australia have responsibilities for same thing from happening again. enforcing the WHS legislation. Other notifications required by SWA They provide education, training and advice on health and safety at work. Legislation requires you to notify or give You can get information about your notice to SWA of the following WHS obligations and other valuable activities: WHS resources both in hard copy and Asbestos notifications online from their websites. Demolition work notifications Hazardous chemicals notifications When are you obligated to make contact? Contact SWA in your State about other Incidents, notifications and contacting matters SWA
Make a workplace complaint
Request a review of a SWA decision Request an inspector to help resolve a workplace issue Ask SWA Infoline a question Compliments and complaints
If you need advice or guidance, in any aspect of safety in your workplace, you should contact Safe Work Australia (SWA). SWA leads the development of national policy to improve work health and safety and workers’ compensation arrangements across Australia. You should contact SWA if you are seeking information and advice on: Complying with Work Health and Safety laws. Reporting a workplace incident. Renewing or applying for licences. Workers' compensation claims. Registering plant and plant designs. They have regulators who Always seek independent legal advice on what is applicable to your situation. 9
Let’s Talk Business Jo-Anne Chaplin Tax & Superannuation Professionals Pty Ltd PH 07 3410 8116 / Mobile 0457 960 566 Email : taxandsuperprofessionals@gmail.com Web: www.taxandsuperprofessionals.com.au
I am a qualified Accountant and will celebrate my 20 th anniversary as a Registered Tax Agent this year. During my time in Public Practice I have assisted clients to achieve business growth and prosperity. My earlier career included positions in banking, manufacturing, construction and retail. My particular interest is in promoting a culture of using local industries and business in order to build a strong community.
BENCHMARKING AND THE ATO
The tax office now conducts reviews on business trading using small business benchmarking. Small business benchmarks as used by the ATO are published on its website, and are categorised into industry type, and then turnover range. From time to time they will issue a notice to a business requesting further information because they have noticed that the business has fallen outside the published benchmarks. The letters are usually generated where the business trading margins fall significantly outside the benchmark percentages. The benchmarks have been developed by the ATO, and are categorised into turnover ranges to allow for economies of scale which occur and are directly related to the size of the business. The purpose of the benchmarks is to identify those business who are under reporting their income. Particularly cash based businesses. The process of review should your business be operating outside the benchmarks is:1. A letter is received from the ATO requesting that the taxpayer check their records and make any voluntary disclosures of unreported income or other errors which may have occurred. A
within the requested time frame so that the matter can be settled quickly. Benchmarking is widely used to review a business performance in comparison to other business of it’s type and size. Benchmarking can provide the owners with valuable insight into their business efficiencies and turnover performance. statement form is provided for this. The taxpayer is also given the opportunity to provide a reason why their business may be operating outside the benchmarks. 2. Once a response is received it is dealt with the tax office will respond with either a decision to accept the explanations provided, or to they will decide to conduct a review of the business’s trading activities. 3. Should a review be requested, then you will need to answer a questionnaire and provide all your documentation for the period to the ATO. There may be many reasons why your business is operating outside the benchmarks, and these can include local economic conditions, staffing issues, health issues or one-off problems associated with a particular job.
If your business is operating outside benchmarking ranges on a regular basis, then is it imperative that the you find the reason for this and remedy the situation. Unchecked margins will result in poor profits and cashflow shortages, which will, in turn result in a shortage of capital available to grow your business. Benchmarking should be undertaken regularly, and is best done when your trading figures are prepared for a quarterly business activity statement. At the very least, an annual review is advised. Once the benchmarking system is setup, it is a simple process to monitor on an ongoing basis. If you are unsure what is required, or want to see the benefits of benchmarking, then please give us a call to discuss.
It is important to respond to the ATO 10
Let’s Talk Business
Paul GILLMORE DFS Founder and Director Southern Cross Financial Services 07 5429 5561
Transition to Retirement v Salary Sacrifice . . . . in Plain English ! powerful is that the tax you would otherwise have paid on the income, goes into your super at a much lower tax rate – the difference between your top tax rate and the super tax rate actually stays in YOUR super !
Transition to Retirement or TTR is a way to boost your superannuation heading towards retirement. You can simply begin to draw some of your super whilst working and contributing to super. It allows you to put more into super, reduce your working hours, you can maintain, reduce or increase your take home pay or a combination of all these. This can be very powerful ! Salary Sacrifice is similar but not as powerful. You can make tax deductable contributions into your super which places more in your super, reduces your taxable income and reduces your take home pay. That’s it ! You can salary sacrifice at any age but you can only TTR from age 55 onwards. Let’s compare and you’ll easily see what I mean. Mary, a teacher aid, is 61 years young earning $51,238 gr p.a. Her compulsory super contributions (SG – Super Guarantee) are $5825 p.a. Salary Sacrifice – Mary contributes $150 p.f. to her super = $3,900 p.a + $5825 SG = $9725 into super. Her take home pay is $1096 p.f. Compared to: TTR. Mary converts $50,000 of her super to pension or income phase and begins drawing $180 p.f.
She contributes $878 p.f. to super. Her Take home pay is still $1096. Mary gets an additional $18928 + $5825 SG = $24,573 into her super retirement savings this year.
The reason why it works so well for Mary is that her top tax rate was 32.5% but with TTR her top tax rate becomes 19%, so, it looks like this:-
Salary Sacrifice
What’s the difference ? It is important to remember that 15% contributions tax is deducted from both contribution amounts
Transition to Retirement (TTR)
TTR strategy is $24,753 – 15% = $21,040 net into super Salary Sacrifice Strategy is $9725 – 15% = $8266 net into super If you compare $21040 to $8266 contributions to your retirement savings, you can see why I call it a powerful strategy but to be fair, Mary’s case is a good outcome, other scenarios will vary but I think you’ll agree, it’s worth at least looking into if you are 55 years and want to boost your retirement savings. Why is this so ? The difference between Salary Sacrifice and TTR that makes it so
Naturally there are calculations and legislative requirements behind the scene and all super funds will recommend you seek financial advice to set up your TTR strategy. If you would like to find out more, or how you could benefit, phone Paul on 5429 5561 PS. This is a real scenario that I did last week. Do you think that Mary (not her real name) is happy? Too bl@#dy right ! 11
Let’s Talk Business Dennis Chiron Marketing Means Business 0451 184 599 www.marketingmeansbusiness.com
dennis@marketingmeansbusiness.net.au Skype: dennis.chiron2
What is Networking? Connecting with the right people to help your business grow and making sure everyone knows about your exceptional products or services is critical to your success in business. Learning to be an effective networker is the key in achieving these two goals. Networking is a life skill, not just something we do when we want something. Great networkers:
Give without expectation.
Do things for others - not to get something back. Have a “share and support” mentality and with this alone anything is possible.
Believe in making the pie bigger for everyone. They cross network with competitors and regularly give away referrals.
Know that having a “protection” mentality, where people come from fear - fear of sharing ideas, of giving information away freely - is a negative way to live.
Believe in the universal law of reciprocity, they know that what you give out comes back tenfold.
Remember great networkers work at their networks for a minimum of 15 minutes per day. __________ Build a Precise Picture of Your Ideal Customer Identifying your target market is the first step of any marketing plan and it’s essential that you are as precise as possible. If not, you run the risk of a scattergun approach that will dilute your
message and drain your budget. Instead, think about your target market in terms of specifics – who in your current customer base is the right fit for your product or service?
you have to offer (what’s in it for them / in what ways will they benefit)? ____________
What have they purchased from you before?
How Much Should I Spend On Advertising?
Do their purchasing patterns suggest they might be a good target? Are they the kind of customer you even enjoy doing business with? What about reaching new customers outside your customer base?
This question is often asked, and there are a number of methods by which advertising budgets are determined. However, it is worth noting that only direct advertising expenditure should be charged against your advertising account.
The more specific you can be, the easier it will be to craft the right message and tactics for reaching that audience. ___________
Direct advertising may include:
How Can You Reach your Target Market?
Photographs
Now that you know who you want to reach and what actions you want them to take, you’ll need to identify the best ways to reach them and with what message. To do this, consider the following about your customers and prospects:
What associations do they belong to? Are they active on social media? Do they subscribe to your email marketing? What print or online media do they read? What are their ‘pain’ points (how can you help address these)? What types of messages or call to actions have they responded to in the past? Why should they care about what
Media space or time; Preparation
of
advertising
material; and show-card writing for display signs and posters;
Printed
promotional and sales literature.
material
Direct advertising expenses do not include: Advertisements that are placed
in publications that are planned to assist charities – this should be charged to your Donations Account;
Gifts to clients at Christmas
time; Lunches,
entertainment, membership of clubs organisations.
or or
Your advertising budget, therefore, should set out what amounts are to be allocated to which media, and when these amounts will be spent. 12
Let’s Talk Business
Objectives of “Let’s Talk Business” Small Business Publication One of the primary objectives of “Let’s Talk Business” (LTB) is to provide a regular, monthly information service to support the Small Business Community. Our goal is to provide a publication offering a wide and diverse range of topics and information which may assist business owners and their teams to gain more insight, knowledge and skills in the overall running of their business, thereby assisting them to build a strong, viable and sustainable business.
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Marketing Means Business “Let’s Talk Business” is distributed to 2,730 business email addresses within Australia and Internationally. We welcome contributions, suggestions for articles and letters to the Editor from our readers. Please address correspondence to: The Editor, LTB PO Box 569
We believe that by offering this free service, we are achieving our goal, and this is evidenced not only by our constantly growing database of businesses receiving the publication, but also by the quality of the authors who unselfishly contribute regular articles to LTB.
Bribie Island, Qld 4507 Phone: 0451 184 599 dennis@marketingmeansbusiness.net.au
Web:
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We pride ourselves on the fact that we have a range of authors who are recognised experts in their industry, and these experts give freely of their knowledge and their time to assist us to offer you quality, practical, professional advice and information.
You are welcome to re-produce any
of these articles. However,
please quote the source as “Let’s Talk Business”. While every effort has been made to ensure that all information contained herein is accurate, no responsibility will be accepted by the publisher.
Letters to the Editor are most welcome
Likewise, the publisher accepts no
Please send your letters to
organisations or individuals and/or
dennis@marketingmeansbusiness.net.au
responsibility for illustrations or photographs
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typographical errors. Views expressed in contributed articles are not necessarily those of the publisher.
“Let’s Talk Business” Small Business Publication
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PO Box 569 Bribie Island QLD 4507 P| 0451 184 599
direct, if you are seeking specific
contact the individual authors advice.
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