WINTER 2012 ISSUE 87
magazine
Carbon Tax Essential guide HIDDEN POTENTIAL EMPLOY OUTSIDE THE BOX
ACCESSING
GRANTS
Winning tips
CHINA
Stephen Cartwright on the Great Wall of opportunity
Tender Writing Avoid the pitfalls
Business Connect
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Editor Ashley Penny (02) 9458 7255 businessconnect@nswbc.com.au Copy Editor Mitchell Lewis DESIGNER Rebecca Solberg PhotographER Dan Gosse, Grant Brooks Advertising enquiries Ashley Penny (02) 9458 7255 businessconnect@nswbc.com.au
NSW Business Chamber Locked Bag 938, North Sydney, NSW 2059 t 13 26 96 f 1300 655 277 e memberservices@nswbc.com.au w nswbusinesschamber.com.au Chief Executive Officer: Stephen Cartwright Business Connect Magazine is published quarterly. Subscriptions: $44 per annum (incl GST). Registered by Australia Post publication number: pp255003/03891 ISSN: 1328-259x. The information published in Business Connect Magazine is subject to copyright and may not be reproduced in any form without written permission from NSW Business Chamber. The opinions expressed in Business Connect Magazine do not necessarily represent the opinions of NSW Business Chamber or its staff. The information published in Business Connect Magazine is intended as general information only and should not be relied on in place of specific legal or professional advice. No responsibility or liability is accepted by NSW Business Chamber or its staff for any claim which may arise from any person acting on the information published in Business Connect Magazine.
News 4
BUSINESS PERFORMANCE
New members
Why our public services need greater competition
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10 pitfalls of tender writing
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Get that government grant
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Events overview
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The corporate philosopher
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SUSTAINABILITY
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The quiet technology revolution 38
Carbon Tax essential guide
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Solutions for energy costs
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CHAMBERS Hunter economy delivers
TRADE
40
Illawarra: enter the marketplace 40
Stephen Cartwright and the Great Wall of opportunity
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Hidden China
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Camden Chamber of Commerce & Industry 42
SKILLS Diversify your workforce
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News Stephen Keir III OAM
Akubra Hats is mourning the passing of former Managing Director and Chairman of the Board of Directors, Stephen Dixon Keir III OAM. Stephen represented the third generation of the Keir family to preside over the Australian company - now in its fourth generation of family ownership. On behalf of NSW Business Chamber, Regional Manager for the Mid North Coast, Kellon Beard, would like to extend his sincerest condolences to Stephen’s family and friends. Akubra has been a valued member of the Chamber for many years.
Rego stickers scrapped in NSW, thanks to Chamber
David Borger to lead business in the west
“This move is a simple yet practical one that will make life that little bit easier for car owners,” said Mr O’Farrell, pictured at the announcement with NSW Business Chamber President Terry Wetherall.
“As a former Lord Mayor of Parramatta, Member for Granville, and Minister for Roads, Housing, and Western Sydney, David is in a unique position to understand the issues confronted by the business community in Western Sydney,” said NSW Business Chamber CEO, Stephen Cartwright.
In a significant policy win for business, Premier Barry O’Farrell, with Roads Minister Duncan Gay, announced the NSW Government will abolish registration labels for vehicles under 4.5 tonnes from 1 January 2013.
Last June, NSW Business Chamber went to the NSW Government with the recommendation of abolishment, citing the stickers as unnecessary red tape for the owners of NSW’s 5.7 million vehicles, of which about one million are registered for business use. “This is a great example of the NSW Government listening to the business community and taking action to eliminate unnecessary red tape,” said Mr Cartwright.
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Former State Government Minister David Borger has been appointed as the inaugural Western Sydney Director for the Sydney Business Chamber (SBC). Mr Borger will operate from the new Western Sydney SBC office at 100 George Street, Parramatta.
“I’m delighted to welcome David to the Sydney Business Chamber and look forward to working with him on a number of key policy areas, including transport, infrastructure, planning and local government reform,” said the Hon. Patricia Forsythe, Executive Director of the Sydney Business Chamber. “The best way for Western Sydney to meet its potential is through a strong and vibrant business community and I look forward to working with Stephen Cartwright and Patricia Forsythe to help achieve that goal,” said Mr Borger.
Australian Business Training Solutions launches into NSW
Australian Business Training Solutions (ABTS) has launched into NSW, adding ten major NSW regions to their already successful Queensland operations. ABTS offers high quality content, industry trainers and courses aimed at up-skilling individuals and enhancing business performance. ABTS’ training programs include Nationally Recognised Training, diplomas, certificate IV, short courses and online courses. Visit abtraining.com.au for more information.
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2012 Annual Awards It is a night to remember, as the achievements of business are celebrated amid fine dining, spectacular entertainment, and peer-to-peer networking. This year, the NSW State Awards will feature comedian and Celebrity Apprentice Australia winner Julia Morris as MC, as well as performances from The Voice finalist, Darren Percival.
That winning feeling InterfaceFLOR produces environmentally responsible modular
carpet for the commercial sector. In 2011, the company won the Excellence in Business Sustainability Award, and hasn’t looked back since. General Manager, Clinton Squires, reflects on the award – and the night itself.
Has the award helped your business? Sustainability leadership is part of Interface’s DNA. It’s not something we give attention to on key projects – it drives everything we do. So while our commitment in this arena is not about winning awards, it
is always nice to be recognised. Winning the award reinforced our leadership in the sustainability arena with the local market.
What’s it like on the night? The NSW Business Chamber Annual Awards ceremony was impressive: the venue, entertainment, speakers and food all contributed to a great night for our team to reflect on our achievements in the past year and network with like-minded companies. For more, visit annualawards.com.au
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News Grant to energise Hunter businesses
An alliance between the Hunter Business Chamber, the City of Newcastle and Hunter TAFE has won a $1.2 million Energy Efficiency Information Grant aimed at helping Hunter-based small to medium businesses save money on their energy costs. The grant will put support into 300 small businesses, with real-time energy consumption devices to help businesses identify, understand and implement practices to reduce consumption and costs. Business will champion these solutions to a further 1500 Hunter businesses through a business-tobusiness mentoring program.
Apprenticeship Centre expands service across NSW and ACT
On 30 April 2012, Senator The Hon. Chris Evans, Minister for Tertiary Education, Skills, Science and Research announced the results of the Australian Government’s recent request for tender, with 23 organisations accepting two-year contracts worth more than $400 million to deliver Australian Apprenticeships Support
Goal! NSW Business Chamber claims plate
won NSW Business Chamber the the Tournament Plate at bers of recent International Cham Cup. rld Wo ll Commerce Footba s ion sat ani org Of 32 corporate W NS nt me rna tou contesting the ing ent res rep r, be am Business Ch China, came in third.
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Services for apprentices and their employers across the country. Australian Business Apprenticeships Centre (ABAC) now has expanded capability to deliver Australian Apprenticeships Support Services across all of New South Wales and the Australian Capital Territory, servicing Sydney, Western NSW, Hunter and North Coast, Illawarra and South East NSW, the Riverina and ACT.
Business leaders honoured on Queen’s Birthday
The Queen’s Birthday proved a day to celebrate for Canberra Business Council Chairman Brand Hoff and NSW Business Chamber Board member Professor Trevor Cairney. Mr Hoff was made a Member (AM) of the Order of Australia for service to the information communication technology sector, to innovative product development and research, and to the community of the Australian Capital Territory. Professor Cairney was awarded a Medal of the Order of Australia for service to education as an academic and administrator, and to business through leadership roles within professional organisations.
Announcing OnePeople HR
The Indigenous recruitment division of Australian Business Recruitment Solutions has recently changed its name to OnePeople HR. Brand alignment strategies in our ever-growing and evolving organisation have driven this change. Many Australian businesses have implemented, or are considering implementing an Indigenous employment strategy within their HR diversity framework. OnePeople HR was established to help meet diversity needs and deliver innovative employment solutions to advantage business and Indigenous job seekers. As a leading Aboriginal and Torres Strait Islander employment specialist, OnePeople HR is committed to helping business and communities drive lasting change. Visit onepeoplehr.com.au to learn more about Indigenous recruitment capabilities.
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Welcome Welcome n Local Chambers of Commerce in Alliance
NSW Business Chamber is working to unify the chamber movement in Australia and strengthen the voice of business through the Local Chambers of Commerce Alliance Program. There are currently 79 Chambers in alliance and 23 in opt-in phase. In the second quarter of 2012 (April to June), the following Chambers joined the program.
Woodburn Chamber Of Commerce Incorporated Drummoyne Business Chamber Tamworth & District Chamber of Commerce & Industry Armidale & District Chamber of Commerce
New financial members NSW Business Chamber also welcomes the following new financial members during the second quarter of 2012. A B Computer Training A.Hartrodt Australia Active Campers Adagold Aviation Air View Group Albury Precision Engineering Alcolizer Pty Ltd Allen Price and Associates Alpha Babies Kindergarten Alt Agency Ambe Marketing Pty Ltd American Chamber of Commerce in Australia AMP Angela Chang Consulting Anglican Retirement Villages Angus Knight Pty Ltd Antony Syndicate Pty Ltd Apple Home Loans Applied Training Solutions Appraisal Smart Pty Ltd Ardrossan Nurseries Area Builders ASWIG Solutions Pty Ltd
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ATF Services Atlantic Lubricants Pty Ltd Australian Entertainment Logistics Pty Ltd Australian Scaffold & Access Pty Ltd Australian Window Association AXT Pty Ltd Back from the Brink Productions Bat Tech Computers Battman Insulation Beauty Therapy College of Australia BeConsulting Bendigo & Adelaide Bank Best Value Imports BG & E Infrastructure BluePackets Bradford Potter Pty Ltd Brainmunch Films Broadmeadow Medical Centre Bruce Davie Bupa Care Services Pty Ltd By George Studios CanPrint Communications Pty Limited Cantlie Carol Williamson Carpenter Court Cassegrain TeaTree Oil Pty Ltd Central West Care Chait Productions Chaos2Control Charles Sturt University Port Macquarie CHD Partners Pty Ltd Cheboom China Railway 15 Bureau Group Corporation Choices & Challenges Pty Ltd Clara Saddi Clark Rubber Kotara Clark Rubber Shellharbour Coastal Windows & Doors Cobbora Holding Company Pty Ltd Concept Creative Communications Pty Ltd Content Group Control Devices Corporate Management Services (Asia Pacific) Pty Ltd CP Communications CPA Australia Ltd Credible Buildling Technologies Crucial Paradigm Cullen Steel Fabrications Pty Ltd Cut/Rush Creative Dalbarb Australia Danish Brew Coffee Darrall Gibson & Sons Plasterers Pty Ltd Das Digital Productions Dean Francis Dominic Melano Downer EDI Works Pty Ltd Dream Patios and Pergolas Duncan Meadley trading as Meadley BRI DV Australia Earth and Company
Eastern Surgical Services EB Mawson & Sons Pty Ltd Emagine International Empire Film Services Empire Specialty Vehicles Employers Mutual Management Endota Spa Engineered Energy Solutions Engineering Unlimited Enlightening Entertainment Publications of Australia Pty Ltd EoR Media ESV Chartered Accountants Evan Harvey Event Cinemas Ferngrove Pharmaceuticals Pty Ltd Fiegerts Ice Works Pty Ltd Field Directional Drilling Fierce Kitty Engineering FIFO Capital - Canberra Footprint Fourth Wall Events Fox Sports Australia Pty Limited Freelancer French Living Magazine Fusion Training Solutions Ganellan Pty Ltd Garvan Financial Planning Wollongong GEMU Australia Pty Ltd Generator Hire Geoff Pilgrim Transport Glen Innes Bowling Club Gloucester Chamber of Commerce & Industry Incorporated Gong 101 Goodman Law Pty Limited Great Value Garages Greater Western Sydney Football Club GreenBizCheck Guests Cakes & Pies GWG Partners Hana Tow Hard Metals Australia Pty Ltd Harms Consulting HCF Hew Sandison Hughes Drilling Ltd Hunter Ports Hunter Springwater Ian Hart & Associates Pty Ltd Ical International Customs and Logistics Icon Business Group i-LEARN Education & Training Impact Art In Autumn Short Film Independent Portable Buildings Inika Pty Ltd Innovation Transport Services Integrated Care & Management Training J.A. Commodities Pty Ltd Jamieson Legal Jane Barrett Jarbo Productions Jemm Group Pty Ltd
Jenelle Livet John Dale Motors P/L John Wheatley Funeral Services JSS Recruiting Katoka Pty Ltd Kerrie Brown KI Studio King Minor Entertainment Knowledge To Action Kostr Ventures Pty Ltd KPMG Kris Kerehona Langano Films Leasing Information Services Pty Ltd Lend Lease Lexx Productions Lifesprings Mineral Products P/L Liftbuild Pty Ltd Lindeman’s Lioncrest Education Pty Ltd Luke Stephens Lumen Lake Creations M.I.R Drug & Alcohol Services Ma Belle Gluten Free Patisserie Macadamias International Australia Pty Ltd Maca’s Crane and Borer Hire Macmillans Waller Fry Mad hatter Concept Masoud Varjavandi Maverick Mav MBM Office National MC Productions Medibank Private Merewether Surfhouse Metro Ice Cream Distribution Pty Ltd Mica Australia Pty Ltd MIR Drug and Alcohol Services Missing Bits Productions Mister Ply & Wood Mordrickson Creations Mounties Group MRC Piping Systems Australia Mr Team Multigate Medical Products Pty Ltd Music NSW Inc My Career Move Nekeema Australia Pty Ltd Nepean Regional Security Ngambaga Bindarry Girrwaa Com Serv Inc Nighthawk Cinema Noble Resources International Australia Pty Ltd Northern Inland Masonic Aged Care Oak Flats Bowling and Recreation Club Oak Flats Community Bank OAS Technology Group Odour Control Systems ( Aust) Pty Ltd Office National Ulladulla Office National Xpress OMA’s Kitchen Optimum Operating Procedures and Services Pty Ltd Opus International
ew members Consultants (NSW) Pty Ltd Osborn Jensen Pacific College of Technology Pacific Smiles Group Paradise Fresh Produce Passmores’ Foundation Ltd Patrick Gallagher Patrick McNamara People Key Pty Ltd Phonenomena Pick Me Up Productions Pines Surfing Academy Plan B Group Nominees Platinum Physiotherapy Polypipe Prescribe Exercise Australia Print Spot Printing & Screen Priority Group Australia Pty Ltd Project Coordination (Australia) Pty Ltd QC Cleaning Quality Hotel Apollo International Quanith Ray White Unanderra Reach Local Australia Rebecca Filipczyk Redback Conferencing Relativity Films
Production Designs Roy Morgan Research Royce White Consulting Rytek Safe Tasks (Aust) Pty Ltd Salvo Floor Coverings & Windows Furnishings Sanguine Films Sharon Bowden Shaw’s Office National Shelford Sheetmetal & UIS Sieracourt Productions Sifters Consulting Signature Mouthguards Pty Ltd Silvertail Skildare Skilled Small Fish Business Coaching Smart Training and Consultation Group Smith & Sons Renovations + Extensions Shellharbour-Kiama Smith & Sons Wollongong Central SNK Group Pty Ltd Social Life Magazine Solar Pictures South Newcastle Rugby League Club Ltd
Spotted Cow Cookies Pty Ltd Star Electrical Co Pty Ltd State Custodians Mortgage Company Stellar Asia Pacific StoneSet Strategic Group Strategic Payment Services Sublime Homes Pty Ltd Succession Plus Pty Ltd Sucrogen Supersmart Power & Energy Saving Solutions Sydney Essential Oil Co. Pty Ltd Sydney migration international Syspro Software Pty Ltd Tamworth Community College Techwerks Terrazellen Industries TFW See & Lee The Breast Centre The Denny Foundation The Mellor Group The Sysdoc Group Pty Ltd The Vault Corporation Tim Stiles TL Distribution Pty Ltd Toll Express Toshiba (Australia) Pty Limited
Transcool NSW Pty Ltd Travelodge Newcastle Trend Micro TressCox Tweed Heads Coolangatta Taxi Service Pty Ltd Utilise IT Pty Ltd UVO Australia Pty Ltd VAADA Vertel Telecoms Viatek Video Social Marketing Virgin Money (Australia) Pty Ltd Wagga Blinds & Awnings Web Noise Pty Ltd Webb’s Gallery Wests Convention Centre White Roof Productions Wild Pure Heart Productions Wilde Legal Williams HR Consultancy Wool Products Australia Pty Ltd WorkCover NSW Working 4 U Yarrum House & Land Youth Directions Inc Zordan Legal
WINTER 2012 | Business Connect
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BLUE BLOODS
NSW Premier Barry O’Farrell and Origin legends Wayne Pearce, Billy Moore and Benny Elias were among the 450 guests at NSW Business Chamber’s State of Origin lunch, held on Friday 8 June at ANZ Stadium. Celebrating the spirit of NSW as ‘Blue Bloods’, guests were presented NRL Club scarves of their choice, and escorted through the dressing rooms and onto the playing field by the Origin legends.
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FEDERAL TREASURER’S LUNCHEON
The Ivy, Sydney, Tuesday 15 May. Federal Treasurer, The Hon. Wayne Swan MP, addressed a group of business leaders at a luncheon hosted by NSW Business Chamber. Among his topics were the Business Tax Working Group, COAG Business Advisory Forum, the impact of the Carbon Tax, and the need to spread the boom through Australia’s ‘patchwork economy’.
BUSINESS LEADERS’ LUNCHEONS Wednesday 16 May: It was a tale of two politicians both representing small business on the same day – albeit at separate NSW Business Chamber events. In Bondi, the Federal Minister for Small Business, Brendan O’Connor, addressed business leaders on the Government’s measures to reduce red tape. Meanwhile, the Shadow Minister for Small Business, Bruce Billson, spoke to a gathering in Sydney’s south-west suburb of Mount Pritchard.
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Business Connect
The role of Richard David Hames is a corporate philosopher, author and knowledge designer. His unorthodox and groundbreaking approach to problem solving has businesses and governments vying for his services. Business Connect magazine found out why. What is a corporate philosopher? A corporate philosopher asks the kind of questions – and acquires the insights – about how a business can be better and bullet proof in the future. Our work is in the future space, shedding light on what is happening in the world today and therefore likely to happen in the future. We then help organisations and businesses design more robust and resilient strategies to deal with any eventuality.
How important are the lessons from the past? In terms of being a foresight practitioner, I bring a methodology
t
he r p o s o l i h p e t he corpora
trade off with what is happening today and what you can be doing in the future. This tool helps you avoid sacrificing future benefits for today’s expediencies.
Businesses rely on data to form strategies and make decisions. But are there different approaches? Businesses make decisions on the intelligence created through conversations with other people. Most of the conversations in business today are very shallow. By introducing uncertainty into conversation, you have a disruptive technique for shifting people into another dimension of thinking. One of my fundamental premises is that attempting to undertake ‘business as usual’ in the next decade will be impossible. People who stick to current formulas will come unstuck. We’re facing so many problems in society that business has an opportunity to create wealth based upon new models and on new propositions.
“By introducing uncertainty into conversation, you have a disruptive technique for shifting people into another dimension of thinking.” to bear on my work which consolidates past and possible into the present “now”. I’m also an unusual futurist, having owned and operated a business. Most futurists are academics, so they divorce their thinking from reality and focus on the future, without considering the real implications on businesses operating today. Early on in my career, I devised a methodology that allows past, present and possible to collapse into current strategic thinking. It’s a profound yet simple way of making sure there’s no
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How do you disrupt? The power of the question is important. It’s the type of question that stops a person in their tracks. You’re attempting to reach into a different understanding of what is possible. I have developed an inquiry method called ‘strategic acupuncture’. It’s a process for solving highly complex problems that you know are costing the business dearly, but seem impossible to resolve. A management consultancy will often say it’s an aspect of cultural change that requires several years
and a small fortune to restructure the business. The consultant is generally very disruptive and costly in fees! Strategic acupuncture turns that conventional wisdom on its head. We can tackle any complex problem and devise an enduring solution within a few hours of forensically interrogating the system – in a way that a consultant cannot do. It’s low cost, unobtrusive and fast.
Leadership is a big focal point of your work. What’s your view of leadership in Australia? There’s a dearth of leadership in Australian government. In the corporate space, I think many CEOs and boards are thrashing around, trying to make sense of what’s happening in the world. Many smaller, start-up and online businesses are showing real strategic leadership. For example, catchoftheday. com.au is a shopping website taking business away from major retailers like David Jones and Myer.
Are there cultural factors to leadership? Within the ethos of disaster capitalism, all that seems to matter now is the economy, return on investment and shareholder growth. These things are enshrined in law for company directors. But many of those assumptions will be invalid in the future. For example, we can’t grow indefinitely on a finite planet. Secondly, Australia is a comfortable place to live, which can make us lazy. Especially at the moment, with the economy going gangbusters in comparison to other countries. However, in terms of economic complexity, Australia ranks 87 out of 123 nations. We currently lack the diversity of skills and knowledge that we’ll need in 20 years time. This means increasing economic complexity by not allowing manufacturing to
Business Connect 13
disappear, for example. As a nation, we can’t rest on our laurels.
‘The future of everything’ is a strapline of The Hames Report, which you author. Can one man intelligently discuss the number of things that shape the future? Ha! I’ve never been asked that question before! A lot of the research my company has been performing over the past decade has been to differentiate between the worldview which I believe we all share and the huge variety of cultural mindsets translating that worldview. What I fundamentally
16-17 AUGUST 2012 MELBOURNE Sponsored by
believe, is that for human beings to remain on this planet, and transcend to another level of consciousness and being – the worldview has to change. Behind the strapline ‘The future of everything’, are fundamental design ideas. It comes back to what we believe we’re here to do, what is important, and how we want to relate to each other and to the planet.
What will you discuss at the upcoming Australian Chambers Business Congress? What I want to do is find a way to open up a different window on the reality. A lot of leaders today have this
niggling feeling that something is not right. Business performance is not as good as it could be, but they can’t put a finger on what’s wrong. I want to provide hope and solutions to what those problems might be. It’s creating a bridge between the normal kinds of things I write about – and my audience. Richard Hames will deliver his keynote presentation, ‘Megatrends: The Future Paradigms of Business’, at the Australian Chambers Business Congress in Melbourne on Thursday 16 August, 2012. Visit businesscongress.com.au to book your tickets today!
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THE CARBON
TAX
ESSENTIAL GUIDE FOR BUSINESS
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Business Connect 15
On 8 November 2011, the Australian Parliament passed laws to put a price on carbon pollution: the Clean Energy Legislation. Better known as the Carbon Tax, every business in Australia will be impacted, whether directly or indirectly. The Facts
and then surrender one permit for every tonne of emissions. • Permits can be purchased from the government, sourced from the Carbon Farming. • Initiative (subject to a 5% limit), or be those allocated under the government assistance and transition schemes.
The Federal Government introduced a carbon tax on 1 July 2012 for a transitional period of three to five years before moving to a cap-andtrade emissions trading scheme. Companies required to pay the tax are those that emit more than 25,000 tonnes of CO2-e per year.
On 1 July 2015:
From 1 July 2012:
• Liable entities remain unchanged and will need to continue surrendering units equivalent to their emissions.
• A liable entity is one that emits more than 25,000 tonnes of CO2-e per year. • The Scheme will commence with a fixed price for the first three years (Fixed Price Period). • The permit price will start at $23 and rise 2.5% each year ($24.15 in 2013; $25.40 in 2014). • Liable entities will need to work out their emissions for each financial year
• The scheme will move automatically into a fully flexible price under an emissions trading scheme, with the price determined by the market (Flexible Price Period), and with a minimum price of $15/tonne.
• Units may be obtained from a variety of sources including government auctions, the Carbon Farming Initiative, eligible international units, free allocations and trading on the carbon market.
SHARE YOUR CARBON TAX STORY How will the carbon tax impact your business? Post your carbon tax story on the new online portal created by NSW Business Chamber. The ‘Share Your Carbon Tax Story’ campaign will inform the debate about the real effect of the carbon tax on jobs, energy prices, and the economy – leading up to the next Federal election. While online, vote in opinion polls and read our Carbon Tax Guide, which has vital business information in plain terms. Visit nswbusinesschamber. com.au/carbontaxstory
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Business Connect
10 QUESTIONS 1
Will small business owners directly pay a carbon price?
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Will every product and service increase in price?
Only the “large emitters” of greenhouse gases will be required to pay for the carbon they release into the environment. Most large emitters already report under the NGERS scheme so they already know who they are. Small businesses will not be required to record their emissions or purchase carbon permits.
The price on carbon will result in price increases for those goods which either produce greenhouse gases or consume electricity. Because the price impact on the company is dependent on the amount of carbon used in producing the good, price rises will not be uniform.
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What are the main areas of business costs expected to be impacted by the carbon price? The companies who will pay the carbon tax will include power stations, mines, gas suppliers, heavy industry and those involved in industrial processing, energyintensive manufacturers and landfill operators. Therefore goods and services where prices are expected to increase include electricity and gas, steel and aluminium, plastics and resin products, paper and packaging materials, chemicals and fertilisers, building materials (bricks, tiles, steel frames, cement), manufactured and processed food products. You may also see increases in charges for waste disposal and collection, transport and delivery and airfares. Transport fuels such as petrol, diesel, LPG and LNG used for off-road business uses and in marine and rail transport are a special case. If you currently claim fuel tax credits for these, you need to make yourself aware of the reductions in fuel tax credit rates effective from 1 July 2012.
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How will I know how much carbon tax I will be paying in my bills?
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Can I increase my prices as a direct result of the carbon price?
The price of carbon will be included in the total price for a good or service. It may not appear as a separate line item in invoices like the GST.
As a business you are entitled to increase your prices as you see fit – it is business as usual. Leading up to and following the start of the carbon price, the same legal obligations not to mislead or make false claims about pricing will apply. If you choose to make a claim about the impact of the carbon price or why the price has increased, this claim should be truthful and have reasonable basis. The Australian Consumer and Competition Commission (ACCC) can investigate and take action against businesses that make false claims. If you make a claim, the ACCC may ask you to provide information to support the price increase. Businesses found guilty of false claims are liable to infringement notices of $6,600, while a listed corporation can receive a $66,000 notice. To find out more about carbon price claims, visit accc.gov.au/carbon
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Will the carbon price increase the amount of paperwork required at tax time?
Small and medium businesses will not be required to calculate or report greenhouse gases, energy or carbon price data. Taxation and BAS reporting will therefore remain virtually unchanged for small businesses. The exception to this is for those businesses currently claiming fuel tax credits. You need to be aware of the reduced rate of fuel tax credits effective from 1 July 2012 and reducing further each year to 2015.
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business owners need to ask about the Carbon Tax
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Will I receive any industry assistance or compensation?
From 2012/13 businesses with an aggregated turnover of less than $2 million/annum will be able to write off $6,500 in depreciable assets. Small businesses may choose to use this increase in the tax write-off threshold to invest in technologies that will decrease their energy consumption. Some businesses in the manufacturing, food processing, metal forging and foundry industries may also be eligible to apply for grants of $25,000 to help them invest in energy efficient technologies.
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What about electricity costs?
The average price increases will vary for customers of the 3 regulated electricity retailers as follows: EnergyAustralia customers can expect a 19.2% increase. This translates to an extra $8.44 per week ($439 per annum) on average for a small business bringing the total average annual bill to $2,729. Integral Energy customers can expect a 10.3% increase. This translates to an extra $4.55 per week ($237 per annum) on average for a small business bringing the total average annual bill to $2,527. Country Energy customers can expect a 17.6% increase. This translates to an extra $9.51 per week ($494 per annum) on average for a small business bringing the total average annual bill to $3,304. The carbon price is not the only source of energy price increases, and the carbon price comes into effect at the same time as substantial electricity network charge increases. IPART has attributed half of these price rises to the introduction of the Carbon Tax. The impact will depend on your level of energy use and whether you are on regulated tariffs or market contract rates. Estimate the impact of the carbon price on your energy costs by using a carbon tax calculator like that found on the Power Choice website (powerchoice. com.au). Learn how NSW Business Chamber can help members reduce their energy costs on page 18.
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What can I do to minimise or offset any cost impacts?
In preparation for the carbon price, businesses should: • Understand the implications of a carbon price on your business – both the increased costs from suppliers and the capacity of the business to pass on cost increases. Ensure only realistic cost changes are passed on, and budget for the ones being passed on to your business; • Identify and cost mitigation opportunities, and investigate the cost effectiveness of offsets, • Review your energy contracts and shop around for a better deal. An energy broker such as Power Choice may be able to help you negotiate a better rate. • Review your suppliers and supply contracts. Consider new suppliers and or negotiate new supply contracts and terms. Signing contracts now to lock in prices before any future price increases may be possible. • Ensure you have robust frameworks in place, including engaging people with the right skills, having the necessary process and system changes in place, and being aware of uncertainties and risks around your carbon data. • Don’t forget that a carbon tax may present your business with new opportunities.
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This all sounds like bad news, is there anything good about the carbon price?
One possible outcome of the carbon price is that over time the emission intensity of a product (as reflected in the cost of the input) will be one of the many issues consumers and other business customers consider in their purchasing decisions and/or choice of suppliers. This presents an opportunity to capture new customers, especially for those early movers who position and market themselves as having low emissions, low carbon and low energy products and services. Read about sustainability certification overleaf.
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Solutions
for reduced energy costs
As something of a double whammy, the carbon price has come into effect at the same time as substantial electricity network charge increases in NSW. Help is at hand! Jonathan Jutsen – the founder of Energetics, a specialist consultancy in energy and carbon management – believes that energy suppliers will pass through the carbon costs in several ways. “There are two different mechanisms that energy suppliers will use: change of law clauses and carbon escalation clauses in contracts - if present,” says Jutsen. But the costs can be challenged. “Where a supplier seeks to increase your energy price using ‘change of law’ clauses, you have the ability to ask for a reasonable explanation of the cost increase. Even where a contract has a carbon escalation clause, it is still reasonable to ask for evidence of the increase in costs and the measures they have taken to minimise the increase.”
Buy better, use less – join our Better Energy Manager Program
Shout your green cred – Business sustainability certification
Take control of rising energy costs by buying better and using less. As part of the newly launched NSW Business Chamber Member Benefits Program, we have partnered with leading energy management experts Energetics, to deliver the ‘Better Energy Manager Program’.
Green business is good business, delivering not just the potential for positive impact on your operational costs and bottom line but also by attracting growing numbers of buyers who make active decisions to buy green and seek out green credentials before they purchase. This is a particular advantage for businesses engaging in Government tenders.
Energetics will negotiate discounted energy rates on behalf of NSW Business Chamber as part of an aggregated group buying program. With the negotiating power of our member businesses and the combined energy usage, Energetics will be able to negotiate significantly reduced energy costs for your business. Additionally, Member Benefits Program partner Energetics will provide members with tools and resources to help you use less energy. Once your deal is advised and you have accepted the offer, you will have access to a comprehensive 50 question diagnostic to help you control expenses and energy usage. There’s also a library of online articles and fact sheets, and a dedicated customer support phone line for any related enquiry. Visit nswbusinesschamber.com. au/memberbenefits for more.
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As part of the Member Benefits Program, NSW Business Chamber has partnered with GreenBizCheck, a world leader in sustainability certification and consultancy services. GreenBizCheck offers online certification programs as well as compliance programs for businesses that want to meet the international ISO14001 sustainability standard. Members can take a free one hour consultation to find out how their business can benefit. Visit nswbusinesschamber. com.au/memberbenefits to find out how your business can reap the benefits of environmental certification.
Member Benefits
PROGRAM Energy
Sustainability
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Insurance
Enjoy exclusive member savings today through the new NSW Business Chamber Member Benefits Program Energy • Lower energy costs through our group energy buying program. • Harness the negotiating power of hundreds of businesses to lock in the lowest rates. • Access tools and services to help you buy better and use less.
Sustainability • 10% discount on online sustainability certification – save money, attract new business and meet government tenders requirements. • Cost effective ISO14001 compliance consultation services – meet international standards for sustainability.
Insurance • Save up to 15% on Small Business Insurance.* • A choice of up to 13 covers designed for your business, including theft, glass breakage and business interruption. • Further savings on Home, Motor and Landlord insurance also available to members.*
Office Solutions • Discounts on more than just office supplies, including everyday technology, print management, promotional marketing, office products, kitchen supplies, business furniture, facility solutions and educational supplies. • Easy and secure online ordering, 24/7.
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nswbusinesschamber.com.au/memberbenefits Insurance is issued by Allianz Australia Insurance Limited (Allianz) ABN 15 000 122 850 AFSL 234708. *Any discounts only apply to the extent any minimum premium is not reached. Policy terms, conditions and exclusions apply. Please consider the PDS before making a decision.
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nswbusinesschamber.com.au
of opportunity
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NSW Business Chamber CEO Stephen Cartwright led a delegation of Australian manufacturers to China to showcase what Australian businesses can offer China’s growing middle class. I didn’t quite know what to expect when I hopped off the plane in Beijing to begin my first visit to China earlier this year but by the time I left, one word kept coming into my head – opportunity! The Chinese middle class is growing rapidly. We are talking about millions of people with disposable income and a real thirst for consumer goods that Australian, and in particular NSW businesses, can provide.
Then it was off to Shanghai. What an amazing city; a mix between Paris and Hong Kong – only four times the size! Shanghai is a modern, thriving and energetic city with a good mix of ex-pat Australian and other foreign residents. In fact, at dinner one night, the entire restaurant seemed full of Aussies, Kiwis and Poms! I did the media rounds in Shanghai, including a 20 minute interview on Shanghai Live, their version of Sky News. The Chinese are fascinated by Australia’s resources sector, but it would be a mistake to think that’s the sum total of their interest – as that television interview showed, consumer goods and services are high on their radar.
Our members made a number of business connections at the Expo, and the follow up has been very encouraging. It’s just a matter of taking the leap and getting out there and that’s the benefit of Chamber membership. We have dedicated experts who can facilitate international trade. On the final stage of the trip, I delivered an address to the Asia Pacific Chambers Congress, where I highlighted the need for the Australian and Chinese Governments to finally sign a Free Trade Agreement. It’s a battle we will keep fighting for. It was a terrific seven days in China, full of highlights. The trip reinforced the important work of the Chamber movement in Australia when it comes
"It’s just a matter of taking the leap and getting out there " My two days in Beijing were coupled with meetings with the Chinese Government and representatives of the city’s Chamber. Also, on behalf of the Sydney Business Chamber, I signed a Memorandum of Understanding (MOU) with the Beijing Chamber to share ideas and resources. I was interviewed for a feature article in the China Daily newspaper about our general business relationship with China, and of course, no visit to Beijing would be complete without a visit to Tiananmen Square and Chairman Mao’s palace. I was blown away by the size and structure of Beijing. The roads are wide and the traffic flows reasonably well - plenty for our planners to learn.
After a couple of days in Shanghai, we made the two hour drive to Kunshan to link up with nine Chamber members for the first Imported Products Expo. A ‘quiet’ State reception for around 800 people (where I was seated at the head table along with the Provincial Governor) followed, and then, the next morning, the Expo began with an opening ceremony best described as ‘lavish’. The Expo itself was a great way for NSW businesses to showcase their products to this rapidly emerging marketplace, and there was no doubt that our stands were the most visited – although it may also have had something to do with regular appearances by Miss Universe Australia!
to opening the doors to foreign trade. Best of all, the Chinese Government has already announced that the Expo will be on again next year, and the NSW Business Chamber will be there again, bigger and better. I urge any members who are interested in trading with China to call our international trade team and get on board! Stephen Cartwright, CEO NSW Business Chamber For more information visit nswbusinesschamber.com.au or phone Sara Cheng, Manager Greater China Region on (02) 9458 7341.
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New trade opportunities in the heartland to achieve a well-balanced GDP structure and sustainable growth. As a result, China’s consumer purchasing power has soared in the past decade. Even during the global financial crisis in 2009, China’s retailing sector grew by over 15.4 per cent. This rate should be maintained annually for the coming decade. As recently reported by World Bank, China has replaced Japan as the world’s second-largest economy, measured by purchasing power. With this huge market potential, overseas companies have been aggressively pursuing opportunities
these well-known brands, they were ignored by most overseas small-tomedium sized enterprises (SMEs) in the past decade. These cities were perceived as lacking in both purchasing power and the consumer awareness to appreciate quality foreign goods and services. In contrast, first tier cities were deemed easier targets, more international - and hence guaranteed return. However, as thousands of SMEs (plus almost every consumer goods and services household name) found themselves competing in first tier cities, the market overcrowded.
Many businesses drowned in a huge market that was outwardly vibrant, but ultimately too competitive.
Cities a goldmine for consumer goods and service exporters
in the consumer goods and service market. KFC, Coca Cola, Louis Vuitton, Chanel and many other household names established a foothold in the first tier cities such as Beijing, Shanghai and Guangzhou 15 years ago. They started exploring second and third tier cities mostly to expand their territory in China by capitalising on increasing consumer demands and purchasing power.
China is increasing individual income levels and boosting domestic demand
While the second and third tier cities are exploited and capitalised on by
Ten years ago, China was the darling of international trade. Today, the giant faces a myriad of challenges that would – on first impressions – suggest a downturn. Think again. Opportunities are abundant for Australian businesses looking to export, import, invest or outsource manufacturing, so long as they delve deeper into the country itself. First, the bad news. China is facing an unbalanced and possibly unsustainable GDP contribution structure which relies heavily on: • government investment construction and export • soaring labour costs • the rapidly growing wealth gap between the rich and the poor • the worsening natural environmental; and • a limited supply of mining resources. And now the good news. To tackle these issues, China is implementing a strategy of economic and social sustainability through increasing individual incomes, going green and directing domestic and foreign investment into under developed regions. This spells multi-faceted opportunities for Australian businesses.
“... our premium products and reputable image open niche market opportunities” The picture has changed. Today, second and third tier cities in China present unprecedented opportunities for foreign consumer goods and service providers. In a list of the richest 20 cities in China in term of GDP per capita, three out of four first tier cities are ranked numbers 1, 8 and 13, while the remainder are second or third u
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tier cities, mostly with a population of over four million per city. Compared with the first tier ‘cousins’, affluent second and third tier cities provide: • Large yet manageable market size • Fast-growing purchasing power • Increasing demand for quality western goods and personal services • Less competition Australian exporters did not miss out on the opportunity to capitalise on China’s fast-growing purchasing power. China overtook Japan to become Australia’s biggest trading partner in 2008. While the ‘World Factory’ takes two-thirds of Australia’s iron ore export by value, wealthy Chinese are consuming Australia’s quality
in the foreseeable future, they can hardly compete with Chinese competitors in the price-sensitive mass market or competitive first tier cities. The market scale in Beijing, Shanghai and Guangzhou is beyond the capacity of most small and medium sized companies. On the bright side, our premium products and reputable image open niche market opportunities to service emerging middle and upper class consumers in the second and third tier cities.
Go inland to set up your factory China is still an attractive sourcing and outsourcing destination compared to developed economies, and even some emerging third-world manufacturing countries. Consider the costs: an
Usage of Foreign Capital Investment, directing foreign investment in labour intensive products to underdeveloped regions in Central and West China. This maintains China’s dominant place as a world factory, but with less impact on the natural environment. It should also alleviate the pressure of labour shortages and soaring labour costs in the exportmanufacturing oriented regions. Being aligned with this national strategy, local governments in Central and West China are providing incentives such as low interest loans and priority land supply for foreign investment across a broad range of industry sectors. An example of inland relocation is the labour intensive and low-value-added textile manufacturing sector.
“Head west and explore second and third tier cities.”
lamb and Shiraz. China is also the biggest buyer of Australian education and the fourth biggest overseas market for Australian tourism. Australia’s image has certainly helped trade relations. The Chinese admire our island continent for its beauty, abundant natural resources, and a mutual goodwill untarnished by historical dispute. Similar time zones (both countries are located in the Asia-Oceania region) are conducive to business as well. In terms of appeal, our products are seen as superior to most OECD countries. Australian exporters have found success with the table of products and services on the facing page. Australian exporters are seizing the trend to export lifestyle-related products and services. However,
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average competitive labour cost in the Chinese manufacturing sector is about 25,000 Chinese Yuan Renminbi (CNY) to CNY40,000 per head per year (equivalent to around AUD 4000 to AUD 6500). The cost reductions are further enhanced by an economy of scale accumulated by China since opening its door to western countries 30 years ago. However, labour costs in export-manufacturing oriented East China and South China is picking up quickly and squeezing manufacturers’ lean profit margin. While growing to contribute over 80% of China’s national export revenue, East China and South China have become stretched in land supply and facilities. To implement the strategy of sustainability and effectively move up the value chain, the China State Council issued the Guidance on Better
By relocating from South and East China to Central and West China, textile companies can reduce manufacturing costs by up to 40%, thanks to the low labour cost, and preferential policies in land leasing and tax in these regions. In the six provinces in East China (such as Jiangsu, Zhejiang and Shandong where the majority of revenue comes from exports), the average profit margin of over 65% of textile enterprise is a mere 0.62%. A cost saving of 40% can revitalise almost any business, not to mention low profit margin industries such as textile, toys and electronic goods. Relocating to low cost regions in Central and West China provides a compelling competitive edge to manufacturers based in China. With all the trends and changes in China, it is time for Australian
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businesses working with this vast nation to review their activities, look beyond the horizon and adopt a smarter strategy. Head west and explore second and third tier cities. It is rarely a short and cheap journey to do business. Enterprising companies need to study Chinese regulations in detail, understand Chinese consumer behaviour, develop a robust strategy, and even leverage Chinese expertise. All these little things can make a profound difference to your business.
Sara Cheng, Manager Greater China Region NSW Business Chamber For more information about how NSW Business Chamber can help you to explore opportunities in China visit nswbusinesschamber.com.au or phone Sara Cheng, Manager Greater China Region on (02) 9458 7341.
The richest 20 cities in China in terms of GDP per capita in 2010 1 Shenzhen 2 Daqing 3 Zhuhai 4 Yuxi 5 Dongying 6 Kelamayi 7 Panjin 8 Guangzhou 9 Xiamen 10 Hangzhou 11 Wuxi 12 Huizhou 13 Shanghai 14 Ningbo 15 Taicang 16 Jiangmen 17 Kunshan 18 Foshan 19 Dongguan 20 Shishi (First tier cities in yellow)
Services and Products Services
Products
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Tourism
Products for children
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Hidden Potential
Diversify your workplace
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We have an enormous, untapped resource, a reservoir of literally millions of people who are capable of both skilled and unskilled labour.
‘Good people are hard to find’ is a sentiment mirrored by employers across Australia. But are we looking hard enough? A one-size-fits-all approach to talent can close your business off to diverse labour pools. Mature-age workers The argument for increasing workforce participation is well established. Australians are aging and our productivity needs boosting. The 2010 Intergenerational Report estimates that the number of people in Australia aged from 65 to 84 will more than double over the next 40 years, with the number of people 85 years and older set to quadruple. Australia will need to grow its workforce to ensure we have the capacity to support both an older population and a growing economy. To fill the gap of a retiring workforce requires a radical rethink in human resource strategies. Future competitiveness is likely to rest on the performance of Australia’s workforce, and the effective use of its potential workforce. Although part of the answer comes from migration, the supply of overseas labour to meet our domestic skills needs is by no means assured. Australia faces stiff competition from other economies seeking skilled migrants. Additionally, emerging economies –
which are often the source countries for skilled migrants – entice more nationals to remain in their home country. With 35% of our working age population not in the workforce, we have an enormous, untapped resource: a reservoir of literally millions of people who are capable of both skilled and unskilled labour. Several attempts have been made to harness this group, with varying degrees of success, but as the pressure builds – mirroring Australia’s aging population – the need reaches desperation point. Groups not currently in the workforce include stay at home parents, people with disabilities, early retirees and other disengaged groups. Not included in the 35% of non-participants, but still an important source of future labour, is the 630,000 unemployed Australians who represent 5.3% of Australia’s workforce. Hiring someone from outside the traditional pool of workers isn’t about taking a risk or an act of charity. It makes plain economic sense to the immediate business, while rippling out to diversify the workforce bolster national prosperity.
Employ outside the box The NSW Business Chamber, in partnership with the Australian Chamber of Commerce and Industry, has released a lead document in a
series examining the potential of the Australian working age population to help better meet the skills and labour needs of business. The tangible benefits for businesses are identified, from competitive advantage and building employee loyalty, to taking advantage of Government incentives.
Disability employment in focus Here’s the business case for employing people with a disability: • No extra cost. It doesn’t cost your business more to hire a person with a disability, and there is support through government assistance. • Ease of recruitment. It’s easier than most people think to employ a person with disability. A Disability Employment Service Provider (DES) can do the hard work of recruitment. • Support. You can access free individualised support for recruitment, job analysis, job matching, advice and training. Ongoing support is also provided. • Financial assistance is available for workplace adjustments and equipment. • Perfect match. If you focus on a good match between a person’s skills and the job requirements you will find the right employee. That person may be someone with a disability. u
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Skilled migrants
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Hiring someone from outside the traditional pool of workers isn’t about taking a risk or an act of charity. It makes plain economic sense...
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On paper at least, skilled migration is unrivalled for potential economic benefits. For example, Michael Clemens (senior fellow at the Centre for Global Development) has estimated that a modest relaxation of barriers to the mobility of labour between countries would bring more global economic prosperity than the total elimination of all remaining policy barriers to goods trade – including every tariff and quota. Of course, labour mobility is one of the many challenges for Australia. For personal, historical, cultural and geographic reasons, most Australians are reluctant to move beyond their immediate region to take on new job opportunities. The trade union reaction to the announcement of the first Enterprise Migration Agreement in May 2012 has the potential to increase sentiment against skilled migration and undermine this important source of labour and skills. The reaction was designed to whip up the emotional side of the issue, ignoring the facts, both in terms of critical nature of the skills shortages as well as overstating the migration impact. It is vital to workforce planning that there remains strong community as well as bipartisan political support for Australia’s skilled migration program.
Work-ready graduates fill the skills shortage Universities are generally under growing pressure from government, industry and the community to demonstrate their ability to respond to skills shortages, the requirements of a professionalised workforce and the demand for work-ready graduates. In response to industry demands, and in recognition of the workplace as a unique and valuable learning environment for students, many
institutions have increased the emphasis on work integrated learning (WIL). WIL provides opportunities for higher education students to apply the theory and skills they learn at university in a workplace. For students, the experience is invaluable and plays an important role in their preparation for the workforce. For employers, the experience goes beyond altruistic outcomes; the student can – and often does – add demonstrable value to workplaces in small, medium and large businesses. Employers participating in WIL programs find the benefits run both ways. For some employers, it is a recruitment pathway; an opportunity to closely examine the skills and suitability of students before they graduate. For others, it may provide an enthusiastic, short term ‘employee’ who can undertake projects or tasks while giving existing employees opportunities to learn valuable mentoring and management skills. Some employers report that students bring fresh ideas and approaches to the workplace, sharing the latest research and thinking in the field they study. Most industries can benefit from participating in WIL. NSW Business Chamber can help link members with universities to create positive WIL placements.
The apprentice In recent years there has been an increasing focus on apprentice completion, with many sectors experiencing rates below 50%. Despite debate about the measurement of completions rates and what a realistic expectation of completion might be relative to other forms of training and study, there is general agreement on one point – there is room for big improvement. At present, state and federal governments are considering reform options for the apprenticeship system. u
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The objective of reform is to ensure improvement of performance, such as retention, completion outcomes and the apprenticeship system’s impact on productivity and innovation.
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... small businesses in NSW employ an estimated 80% of apprentices in the state.
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Importantly, small businesses in NSW employ an estimated 80% of apprentices in the state. So what can small business owners do to improve retention and completion of their apprentices? The NSW Board of Vocational Education and Training (BVET) has undertaken research to identify opportunities for improving recruitment and retention of apprentices in key trades and increasing the number and proportion of apprentices who complete training and go on to work as qualified trades people. The research has found that predictors of success are overwhelmingly about the employment relationship – both apprentice and employer living up to their end of the bargain. The report emphasises the importance of a “fair deal”. The essential elements are: • Richness and depth of the work experience with no long periods of performing the same task or excessive time spent on meaningless work • Coaching and mentoring with real on the job training provided by a skilled tradesperson. Avoid setting tasks which are beyond the apprentice’s skillset, and where support is not available. • Appropriate supervision, with increasing flexibility and autonomy. However, in the early months, leave no time unsupervised. • Pay that reflects merit. Competency-based pay and progression based on skills and
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work performance, and not an artificial time construct. • A good boss who relates to the apprentice with empathy – we all started somewhere! • Open communication. Keep channels open between apprentice, employer, work colleagues and registered training organisations. • Prevent bullying. Employ fair work practices including a contemporary workplace culture that prevents bullying and ensures safety. NSW Business Chamber has long advocated for improvement in recruitment processes and further support for employers. Future reform of the apprenticeship system will need to focus on the key predictors of success, namely the recruitment phase (matching of employers and apprentices), the employment relationship, effective pre-apprenticeship programs and support for employers. NSW Business Chamber will actively seek to shape future apprenticeship reform to ensure the best outcomes for both apprentices and employers. For more information and advice on themes raised in this article, please contact Nick Minto, Senior Policy Adviser, Employment Education and Training, NSW Business Chamber at nick.minto@nswbusinesschamber.com.au or on (02) 9458 7267.
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No contest
services c i l b u p r u Why o petition m o c r e t a e r need g
The public sector is 20% of our economy, yet its productivity receives little attention. Can we achieve better outcomes for the community? NSW Business Chamber is advocating greater competition and contestability of public services – and the State Government is listening. NSW Business Chamber has commissioned and launched a report to guide the NSW Government at a time when demands on the government’s budget are growing, but the revenue to deliver those quality services is not. Diversity and Contestability in the Public Service Economy – authored by Gary L. Sturgess, Adjunct Professor of Public Service Delivery at the Australian School of Business, and a former Director-General of the NSW Cabinet Office – sets out seven guidelines to improve the delivery of public services in NSW by introducing new competition and contestability. “We are certainly not proposing the wholesale privatisation of government, but let’s put the public sector to the test and make sure it is delivering the best services it can to the community,” said Stephen Cartwright, CEO of NSW Business Chamber. NSW Premier Barry O’Farrell voiced his support of the report at a July address to the Committee for Economic Development of Australia: “I welcome the interest of the NSW Business Chamber in public sector contestability in commissioning research on this important public policy area, and their investment in thought leadership in this sphere”.
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Changes recommended by the report are: 1. Mixed economy. By adopting a ‘mixed public service economy,’ government services can be provided by a combination of public, not-forprofit and private suppliers; 2. Benchmarking. The productivity of the state’s public services should be measured and benchmarked against interstate and international equivalents; 3. Export strategies for competitive public services should be developed by the Department of Trade and Investment, Regional Infrastructure and Services;
“... let’s put the public sector to the test” Thought Leadership Program Feedback from membership is the mainspring for NSW Business Chamber policy and advocacy work, as shown by the state-wide ‘10 Big Ideas to Grow NSW’ campaign. In 2012, businesses have asked the Chamber to challenge government on the issue of performance. After all, businesses are expected to change in response to global competition and low levels of demand – shouldn’t our governments also change their practices?
4. Commissioning. The government should adopt a strategic ‘commissioning’ approach (what to buy and how) to future procurement from public, private or notfor-profit providers; 5. A transition period is necessary for government and suppliers to understand each other’s expectations and to develop the capabilities to succeed in competitive tendering; 6. Good people. Public services cannot succeed unless providers employ quality staff imbued with a strong public service ethos; and 7. Transparency and accountability of competition and contracting.
To encourage new thinking, NSW Business Chamber intends to shape debate and the public policy agenda by tackling new issues, and creating new solutions to known problems. The end goal is to influence government policy in favour of business outcomes. Follow the Thought Leadership Program at nswbusinesschamber. com.au/lobbying-government.
Business Connect 2012 spring edition
Early bird advertising offer Advertise in the upcoming spring 2012 edition of Business Connect magazine, where your business will appear in hard copy and viewed by over 10,000 NSW Business Chamber members. Full page: $800 Half page: $400 PLUS additional advertising in Business Connect eNewsletter at no extra cost. Rates are GST inclusive. Please note advertisements are capped per edition, with preference to first enquirers. For more... Email businessconnnect@nswbc.com.au or call Editor, Ashley Penny on (02) 9458 7255.
Early bird advertising rates - offer expires 14 Sept
Qualification courses at no cost to you
As part of a Federal and NSW Government initiative the below ITCC qualifications give employers access to funding to cover all course costs: • Certificate IV in Small Business Management • Diploma of Business
• Certificate IV in Frontline Management • Diploma of Management
Once eligible staff complete their course you are reimbursed 100% of all course fees. Staff can study the majority of the above courses via distance.
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We live in a risk adverse society. Everyday we see demands and calls from governments to eliminate risks.
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Yet whilst the prevailing community culture demands the elimination of risk, business people know that risk is central to business life. In business, risk is linked to reward. The higher the risk, the higher the possibility of a major financial payback or failure.
with the concept of a ‘super profits’ tax is that it actually attacks those who are innovating and succeeding over and above the rest of the market. It is these risk-takers and innovators who actually drive productivity, innovation and growth throughout the economy. I believe we need more companies in Australia making super profits – or in other words, making an even higher rate of return on their investments. Surely we have seen in recent years that it is better for a country to have a profitable banking sector than one that is bailed out by taxpayers!
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The act of leaving a salaried job, going into business, and possibly mortgaging a home is the risk that most small business people make as they embark on creating and growing a business. In time, as a business grows, a business takes on staff and with it the risks associated in meeting the obligations that come with employing people.
The issue of risk is central to the economic debates occurring in Australia, particularly as they relate to profits and finance. I’ve been thinking about risk and its link to profits ever since the Federal Government announced it was introducing a ‘Resource Super Profits Tax’. Putting to one side the issue of what is the appropriate level of taxation for the nation’s resources, I do question the concept that businesses in
“The concern I have with the concept of a super profits’ tax is that it actually attacks those who are innovating and succeeding over and above the rest of the market.” competitive and open markets can make ‘super profits’ and in turn, be taxed with additional tax surcharges. I question the notion of ‘super profits’, because it infers there are levels of profitability that are somehow inherently wrong, improper or unhealthy. I don’t accept this, and worry that if the concept gains credence, then the concept of ‘super profits’ could be extended to other profitable sectors such as banking, technology or the services sector. The concern I have
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As Stephen Cartwright, CEO of NSW Business Chamber has pointed out, the correct management of risk, when it comes to small business finance, is about optimising capital flows and encouraging small businesses to get out into the market place. Economies grow because business everyday makes calculated and informed risks. It grows because people are willing to experiment, to innovate and chase those elusive ‘super profits’ and if they succeed, I think all Australians are ultimately winners. Roger Hood President, NSW Business Chamber
Business Connect
10 pitfalls of tender writing Too much is written about how to win bids, and not enough on how they are lost. In 40 years of guiding people to tender success, Phil Cohen and Shipley have seen where mistakes are made and repeated. Avoid these 10 clangers to emerge the winner.
1 Abstaining from contact with the customer until they publish the RFT
Customers are poor at putting the real issues into a Request for Tender (RFT). You’ll never find “what we didn’t like about our last supplier” in an RFT, or “price is no object as long as you can solve this problem”. The real issues behind a purchase are almost always absent from the RFT. Unless you’re engaging the customer before the RFT is released, you won’t discern this kind of information, or address the real issues in the bid.
2 Tell them all about yourself The more your bid document shows that you know about the customer and their issues, the more they will listen. If your bid is all about you, you’ve proved that you know (or care) nothing about them.
3
Tell them what you think they need to know, not what they asked Assessing bids is hard work. Where the bidder doesn’t answer the question, they’ll generally score a zero for that part of the response. By all means tell them what they need to know, but answer their question first.
4 Put it all in, and let them figure it out When you have no idea what problem the customer is actually trying to solve, the temptation is to put everything
in (brochures, case studies, white papers) and let them figure it out for themselves. If the person reading the bid can’t find the information quickly, it might as well not be there, because they have numerous bids to read and they’re in a hurry.
5 Miss the deadline People who evaluate bids for Government are delighted when bids arrive late, because it means they don’t have to worry about them: they go straight on the ‘losers’ pile. You may still be evaluated in commercial bids, but what does missing the deadline tell them about you?
6 Stick with just text
When you read the newspaper, you’ll look at the pictures first, then the headlines, and then the picture captions, all long before you bother with the text. Why throw away prime real estate by using wall to wall text? Use pictures, graphs and diagrams, and have a caption below each one telling the reader what they’re looking at and why it’s important.
7
Don’t bother with proof - they should just trust you When you say things like “we’re the best in our industry” or “our products are second to none” do you expect the customer to take your word for it? How much more powerful is a statement like “we have 80% market share in our
industry” or “our products won top slot in all of the industry awards last year”? Include proof when making a claim.
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Write the Executive Summary last An Executive Summary is more than a piece of fluff written at 3 am on the day the bid is due. By writing it before you begin writing the bid response (or even before the RFT is released) you can use it as a powerful internal document for making sure your bid themes and strategy are communicated to your bid team.
9 Never train your bid staff
All professional salespeople have done at least one round of sales training, if not more. If your organisation receives significant revenue from bids, it makes sense to provide training for your bid team. This affects your revenue just as directly as sales training.
10 Ignore professional advice A professional bid consulting firm, backed by experience and a track record of success, can help provide training and support for major bids.
Phil Cohen, Director Shipley Asia Pacific Shipley is a training and consulting firm helping businesses to win bids. Visit shipleywins.com.au or call (02) 9232 2030.
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Get that government grant
During the financial year there will be over 500 grants and concessions worth billions of dollars available in a variety of formats and providers. So how do you get access to them? The landscape is complex, but there is an overall principle to heed. It’s all about leverage: government is not an entrepreneur but a facilitator of resources to achieve specific outcomes for regional or national benefit. In return, they expect employment generation, increased revenue, higher taxable receipts, value added opportunities and strong flow on effects to the economy. As such, requests for government assistance should address these parameters which are not necessarily about goodwill or benevolence.
What extraordinary outcomes can be achieved for government? By following a business life cycle it’s easy to see where government would like to deploy their resources. It’s not a cradle to grave scenario, but essentially a scaling towards the development of new products, services and ideas and their eventual exploitation. Think of terms such as Research and Development (R&D), Commercialisation, Export, Business Growth, Climate Change and Regional Employment.
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Top 10 grants Categorise the type of funding into existing programs. Don’t be a pioneer. If you are not satisfied, let the industry and lobby groups express your specific needs to government. Seek advice as to what is available by searching web sites, particularly Ausindustry, Austrade, and NSW Government, Google search key words, stay close to the NSW Business Chamber and keep abreast of changing government policy.
Go for the low hanging fruit as first priority. Understand which grants are tried and tested with an objective funding and assessment criteria (eg R&D, EMDG, ATS). Leave the subjective, merit-based funding proposals to those that represent significant value-added opportunities.
Don’t delay application. Understand what is being funded and types of expenditure allowed. Many government programs are underfunded and a change in government priorities can quickly cull funding. Websites can be out of date and quite often promote schemes that have been fully allocated.
Harness expertise. Grants preparations experts understand the whole process, and can help with the most important rule in maximising any grant opportunity – structuring.
î FOR YOUR NEW IDEA R&D Tax Incentive. Available as a refund for experimental activities addressing a knowledge gap. It’s applicable to businesses under $20 million turnover, effectively refunding R&D expenses 45 cents in the dollar. Concession value is a 133% tax deduction for over $20 million turnover.
î FOR YOUR PRODUCT LAUNCH Commercialisation Australia is a merit-based scheme formulated to build sustainable businesses from new intellectual property. Funding support includes payments up to $50,000 to bring in appropriate skills and knowledge; up to $200,000 to engage a CEO or senior executive; between $50,000 and $250,000 for a proof of product concept; or dollar-for-dollar funding between $50,000 to $2 million to take a new product to market. Australian Technology Showcase fosters new and innovative technology companies with funding of up to $20,000 for collateral support for seminars and showcasing to local and international markets; $15,000 for Tech Vouchers and a small allowance for a Start Up House studio in Silicon Valley.
î FOR BUSINESS GROWTH Enterprise Connect is available for selected businesses and can provide up to $20,000 assistance for tailored improvement of business systems and processes or up to $50,000 to fund the salary costs of researchers. NSW Business Chamber is a provider of the Enterprise Connect Program. The Textile Clothing Footwear (TCF) industry is supported by funding that can provide up to $50,000 to a small TCF business for projects that can improve their business enterprise culture or dollar-for-dollar support for
larger projects that exceed $250,000 to boost innovation and capability. Media-Screen Australia provide a multitude of film, drama and documentary assistance including the 40% film producers offset, enterprise programs, events and travel grants. Screen NSW also has an Interactive Media Fund that provides grants and funding for NSW based digital content providers. The Export Market Development Grant (EMDG) provides a grant of up to $150,000 per annum and allows a dollar-for-dollar reimbursement of overseas marketing and promotion expenses over $10,000. The TradeStart program is delivered by experienced trade professionals and is a free service to open up and develop markets for small-tomedium businesses. NSW Business Chamber is a delivery partner. A $4,000 Payroll Tax Rebate is available for taking on new employees who are engaged over a two year period. Also consider apprenticeship schemes.
î FOR CLEAN TECHNOLOGIES Over $10 billion has been set aside to help manufacturers improve energy efficiency and reduce pollution. Merit projects include switching to less carbon intensive energy sources, installing new equipment, processes and facilities to reduce energy consumption and emissions. Recently commenced programs include the Clean Technology Investment Program $800 million and Clean Technology Food and Foundries Program $200 million. Richard Yabsley Chartered Accountant Bacchus Associates
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The quiet technology revolution
The advent of mobile broadband, coupled with pint sized computer-like technology – smartphones and tablets – is changing the face of Australia’s small business. The growth of mobile technology means small business people can keep doing business in more places. According to recent research undertaken by Telstra Business, Australia’s small-to-medium sized
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enterprises (SMEs) will spend more on technology this financial year than on any other traditional capital investment, such as plant and equipment. And that’s a new trend. “We’re in the midst of a quiet revolution in the tools available to SMEs – tools that can increase their productivity, expand their reach and help them create new products and services,” says Will Irving, Group Managing Director of Telstra Business.
“SMEs want to get back to the core of what they do best - and that is to serve new and existing customers really well, and enable their staff to do so. “Feedback from our Telstra Business Centres across Australia indicates the ‘must have’ device for small business is a smartphone for remote working, productivity and mobility – they simply don’t want to be chained to their desks, workbenches or counters anymore,” he said.
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66 Small business people ed chain don’t want to be ymore.” to their desk s an
6 Global indicators predict the move to mobile, and a more connected world, is only set to increase. The latest research by global networking organisation Cisco, shows exponential growth in internet usage. In Australia, internet traffic will grow 7.3-fold from 2011 to 2016, a compound annual growth rate of 49%. By 2015, total Australian fixed and mobile internet traffic will be six times larger than in 2010, and by 2016 each Australian is predicted to own 5.7 devices connected to the internet, up from four in 2011. For SMEs, new technologies are within their realm of understanding (they don’t need to be an IT expert to work them), and are giving them more power to better pursue customer service solutions and to gain greater flexibility and control. “Importantly, it’s providing them with more freedom and creative options to realise some of the key benefits for being a small business in the first place,” Mr Irving said. “Getting things done faster frees up staff to do more billable work, or simply have a better work-life balance. “Specifically, for business accessing services like 4G, they have office-like broadband speeds when they are on the go, making it possible to handle
large files like project plans, highresolution images or videos, and to stream live video from the field.” Telstra’s research found the most common reasons for setting up a small business were to gain independence, freedom and flexibility. According to Mr Irving, “SMEs have never before had such versatility and accessibility, which is allowing them to get up close and personal to their own business, and as a result, they are unlocking their own opportunities.” “For example, one small business owner uses Google Maps on his phone to speed up quoting on jobs requiring roof access by zooming in to see the roof. And a sign company that erects ‘For Sale’ signs for real estate agencies now takes a photo and sends it immediately to their client to approve the sign’s placement. They are specific, detailed solutions.” High-speed networks are not only helping to keep business better connected, but are part of a quiet revolution helping change the way small businesses do business. Visit telstra.com.au for more.
communication trends for SMEs
1. Business is going mobile Many new businesses are ‘born digital’ and ‘born mobile’. There are nearly 30 million mobiles in Australia – and not all of them are connected to people. Machine-based mobile devices are creating new possibilities – for example, where there’s a vending machine with a credit card payment option, there’s a mobile device in the back of it.
2. The internet is business oxygen The internet is expected to ‘always be there’ to connect business – it’s becoming ‘business oxygen’.
3. The cloud will grow Cloud computing is increasingly being relied on instead of purchasing software in a box. The benefits of pay-as-yougo software include the ability to scale up and down as needs dictate and cost savings of between about 20 and 70%.
4. Video conferencing High definition video conferencing means more businesses will meet face to face without leaving their office, shop or home.
5. The ‘apps’ revolution Thousands of applications on all platforms are available now to help business do business better.
6. Continued rise of social media Small businesses are increasingly using social media and online. And for younger customers and employees in particular, if you aren’t on social media, you barely exist.
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s r e v i l e d y m o Hunter econ
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At Federal and State levels and in international marketplaces there has been much comment about how the Hunter region not only survived the global downturn but grew and continues to grow. The simple answer, of course, is the strong presence of mining in the Hunter. Continued internal growth in
picture of the diversity of the region. Our ‘Leader’ group includes NIB Health Funds, Centennial Coal, Coal & Allied (Rio Tinto), Cobbora Holding Company, Newcastle Permanent Building Society, ORICA Mining Services, Telstra, Tomago Aluminium and Xstrata Coal. Our ‘Gold’ members include Ausgrid, Austar Coal Mine, Eraring
“A quick glance at the leading members of Hunter Business Chamber paints a fair picture of the diversity of the region.” demand for coal with rising prices has certainly underpinned this success. However, it is not just in this sector that there has been success and growth. A quick glance at the leading members of Hunter Business Chamber paints a fair
Energy, Hunter Ports, Hunter Water Corporation, Macquarie Generation, Newcastle Newspapers, OneSteel Market Mills, Pacific National, Port Waratah Coal Services, The Kloster Group, University of Newcastle and Wests Group Australia.
These leading companies generously support many activities for fellow Chamber members including the innovative Hunter Business Mining, Hunter Business Infrastructure and Hunter Business Health forums. Each of these regular forums allows members to access knowledge and contacts in those sectors. This approach has had considerable impact in helping to ensure our medium and small enterprise companies have been able to match the demands of larger firms in terms of quality of products and services, and so help continue the regional growth. Kristen Keegan, CEO Hunter Business Chamber
For more information about the Hunter Business Chamber, visit hunterbusinesschamber.com.au
e c a l p t e k r a m Enter the Illawarra Business Chamber has an enviable reputation for hosting popular events. The Business Marketplace raised the bar even higher. This new event showcases a range of the Illawarra’s leading businesses. Held on 13 June 2012, the Business Marketplace was officially opened by
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the Federal Minister for Small Business, The Hon. Brendan O’Connor MP along with Member for Cunningham, Sharon Bird MP and Member for Throsby, Stephen Jones MP. “The Business Marketplace is a great opportunity for local business people to get out, network, see what other businesses are doing to
succeed and catch up with the latest business advice from local advisory services,” said Mr O’Connor. Another component of the Business Marketplace was an executive lunch hosted by Commonwealth Bank with guest speaker and economist, Savanth Sebastian, followed by Group Managing Director for Telstra Business, Will Irving.
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HUNTER Business Chamber
Tea with the Treasurer
Business Development Forum
EVENTS
Hunter Business Infrastructure
Illawarra Business Chamber
The Business Marketplace
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r o d i r r o c Camden' s
es faster m ti r u fo te ra a t a ns will grow xt 15 years.” e n “... local populatio e th r e v o y e n d y than S
Camden is located in the rapidly growing south-west corridor of Sydney. What does it all mean for local business? David Cadden, President of the Camden Chamber of Commerce and Industry, has answers. What’s your history with Camden Chamber of Commerce and Industry? I have just completed two years as the President, having joined the Chamber to learn more about my local business community and to also help shape its future. My day job as General Manager of Macarthur Credit Union has a fundamental community element and the chamber was a natural channel to meet that need. This involvement has also led to a position on the Western Sydney Regional Advisory Council.
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Do businesses in south-west Sydney face unique challenges? Yes. In addition to the normal challenges of legislation, compliance, competition and cost control, businesses in our region face the challenge and opportunity of operating in the fastest growing local government areas in NSW. It’s a problem that is welcome, as the local populations will grow at a rate four times faster than Sydney over the next 15 years. The challenge comes from where best to place outlets or channels as the market volumes change as well as the market profiles.
What key message would you take to Federal/State government on behalf of your members? Fulfil their election promise to reduce red tape for business! Seek to decentralise white collar
jobs to help local economies and to reduce the commute time that negatively impacts many families and hence their local communities.
How does your Chamber go the ‘extra mile’ for members? We have fun at our meetings, and seek to deliver quality speakers that give business owners an advantage in running their operations. We are also attempting to engage more closely with the local council to help shape its decisions that have long term and far reaching impacts on business.
What are the benefits of going into alliance with NSW Business Chamber? In addition to the training and advice services, the NSW Business Chamber also acts as an ear for business and can then transfer that knowledge to the relevant State or Federal Minister. Visit camdenchamber.com.au for more
Learn from experience In-house customised training Realise the benefits of customising training through increased productivity, return on investment, and convenience. We can deliver any program tailored to the needs of your business such as: • • • • •
Communication and conflict management Excellence in customer service Techniques for supervisors Time management Plus much more
Online learning and face to face courses In addition to our customised in-house training, we have a wide variety of flexible online learning options and face to face public courses running in your area. New additions to the NSW public calendars include Return to Work Coordination (Introduction) and Health & Safety Representative training.
“The program has been fantastic, our
Member discounts
trainer is really professional and willing to go the extra mile and just last week, one of our employees was able to use the skills developed through the course to deal with what could have been an otherwise challenging situation.”
Quote your NSW Business Chamber member number for a 10% discount*, or quote your NSW affiliated Local Chamber member number for a 5% discount* off our standard non-member prices.
Lacey, Dole Australia PTY LTD Certificate IV Frontline Management – In-house training
*Conditions apply, contact 1300 572 439 for more information.
Learn from us Call 1300 572 439 or visit abtraining.com.au
$13 million
in community contributions in NSW/ACT Bendigo Bank’s NSW and ACT network of branches have contributed more than $13 million to support local community groups, clubs and not-for-profit organisations. And it’s all made possible by local people making a choice about where the profit from their banking goes. It’s inspiring to think that contributions from our NSW and ACT branches has helped Bendigo Bank’s national network of branches
reach the significant milestone of $80 million in contributions to their communities. So make a difference – to your own banking and your community. Call into your local branch or phone 1300 BENDIGO.
Bendigo and Adelaide Bank Limited. ABN 11 068 049 178 AFSL 237879. CODE (40978) (06/12)
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