Aussie Painting Contractor April 2019

A ONE MILLION DOLLAR BUSINESS Just because you have a lot of staff, it doesn’t always mean you are making a lot of money.

The Warning Signs of NON PAYMENT It is better to be in dispute over less money, than over 8 months worth of work.

Managing Your SALES EFFORT Lessons From Three Pricing Stories Pricing mistakes that can happen in any business...

www.aussiepaintersnetwork.com.au

眀眀眀⸀愀甀猀猀椀攀瀀愀椀渀琀攀爀猀渀攀琀眀漀爀欀⸀挀漀洀⸀愀甀

CONTRIBUTORS

From the Editor

• Angela Smith • Anthony Igra

Hey Everyone,

• Daniel Wurm

It only seemed like yesterday it was Christmas and it’s only a couple of weeks till Easter. Where has the time gone?

• Jim Baker • Justin Kenardy • Leo Babauta • Monroe Porter • Peter Whiteford • Robert Bauman • Sandra Price

EDITOR

The last couple of months have been busy for APN with training continuing and finding apprentices for employers and vice versa. Find us on Instagram to see how training is conducted. We have been endorsed by Queensland Rugby League and are currently contacting Rugby League Clubs looking at career pathways for players. We feel that its a great fit for Employers having fit apprentices that are disciplined and understand what its like working in a team environment. If you need some more information please contact me.

The major topic that has hit in the last couple of days has been Artibus asking for feedback from the Industry on the changes to the training package. If you are wanting to have your say you only have a couple of days left to do it. Click the LINK for more info. SURVEY All the units are downloadable here and feedback can be provided here before April 5th, 2019.

Please go and have your say on the proposed changes.

Nigel Gorman EXECUTIVE EDITOR Caroline Miall

'Till next time, Happy Painting!!

GRAPHIC DESIGNER J. Anne Delgado

Nigel Gorman

nigel@aussiepaintersnetwork.com.au

07 3555 8010

Advertise with us...

1800 355 344 07 3555 8010 info@aussiepaintersnetwork.com.au

www.aussiepaintingcontractor.com

Contents 6

Tradie Accountants

A good accountant will do more than just lodge your tax returns each year

A ONE MILLION DOLLAR BUSINESS Future budgets are going to have to spend more on welfare, which is fine. It’s spending on us

The Warning Signs of NON PAYMENT

11 14

EFFECTIVELY train your 20 tradesmen and office staff Discover a new way to provide a Win/Win for you both

Create a Healthy Eating Pattern

These five warning signs happen in combination or on their own.

27

aren’t necessarily a reason to panic: they are your body’s way of responding to stress

HOW TO MAKE SURE THE PRICE IS RIGHT

Managing Your SALES EFFORT

33 36 38

The Two Most Powerful Ways

Panic attacks

17

23

Lessons From Three Pricing Stories

30

The case for “Industrial Manslaughter” Industry Idiots

40

Important Contacts

41

Opinions and viewpoints expressed in the Aussie Painting Contractor Magazine do not necessarily represent those of the editor, staff or publisher or any Aussie Painters Network’s staff or related parties. The publisher, Aussie Painters Network and Aussie Painting Contractor Magazine personnel are not liable for any mistake, misprint or omission.

Information contained in the Aussie Painting Contractor Magazine is intended to inform and illustrate and should not be taken as financial, legal or accounting advice. You should seek professional advice before making business related decisions. We are not liable for any losses you may incur directly or indirectly as a result of reading Aussie Painting Contractor Magazine. Reproduction of any material or contents of the magazine without written permission from the publisher is strictly prohibited.

Tradie Accountants When running a trade business, should you use an accountant who specialises in the trades?

Any old accountant will be able to look after you as a tradie, but there are benefits to using one who specialises in your industry.

It’s no different to why tradies love using Trade Risk for their insurance.

Sure, you could use any other insurance broker, but our difference is our expert knowledge and experience in your field.

In this guide we’ll take a closer look at the pros and cons of using a specialist tradie accountant, how they can help your business and how to choose the right one for you.

The topics we’ll be covering include the following: • Why even use an accountant?

• Why use a specialist tradie accountant?

• How can an accountant help my business?

• Local or online?

• Do I need an accountant if I use Xero?

• Choosing an accountant • Why Even use an Accountant?

• If you’re a sole trader, you might be asking why you even need an accountant.

6 | Aussie Painters Network

For trade businesses setup as a Pty Ltd company, you’ll know that you have to lodge your returns via a registered tax accountant, but for a sole trader you still have the option of doing it yourself.

If you are considering the DIY option, think of it the same as someone doing their own DIY building work at the home. Many people do it perfectly well, but some completely mess it up!

A good accountant can do a lot of good for your business, so even if you’re a sole trader, it’s at least worth having a chat with a few accountants to see if they can help you.

Why use a Specialist Tradie Accountant?

There absolutely no reason why any suburban accountant couldn’t help out the average trade business owner with their tax.

However that accountant will be dealing with all sorts of people, from private individuals to other small and medium sized businesses. This gives them a wide breadth of experience, but no real specialisation.

It’s very similar to how we operate on the insurance side at Trade Risk.

Any other broker could assist our clients, but because we specialise

in the trades, we have built up specialist knowledge very specific to trades.

We can answer our clients’ questions and solve their problems much more quickly, as we’ve probably dealt with something similar from another business in the same industry.

By using an accountant (and/or bookkeeper) who specialises in the trades, you can benefit in the same way from their more specific experience and knowledge of how a trades business operates.

How can an Accountant Help my Business?

A good accountant will do a lot more than simply lodge your tax returns each year.

For starters they can advise you on the best structure for your trade business. They might find that you’re better off structuring as a company or via a trust. This could save you tax dollars or assist with asset protection. As well as advising on the best structure, they can also have the structure put in place for you and setup properly. There are options for taking the DIY path on company setups, but again, DIY can be a risk unless you really know what you’re doing.

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Some tradies are great at monitoring their cashflow and the health of their business, but for others it can be a weak point as their focus is more on winning and/or being on the tools.

A proactive accountant can keep an eye on these things for you, helping you to identify any cashflow issues within your business and plan how to fix such issues.

Your accountant can also keep you more accountable in various areas, such as lodging your BAS, paying your tax instalments etc. It’s far better for your accountant to follow you up for these rather than the ATO!

Local or Online?

One of the big decisions to make when choosing an accountant for your trade business is whether you want to use a local firm or not.

In the old days you would always go for a local firm, as you’d be visiting them at least once a year to drop off your box full of receipts.

These days, especially with cloudbased accounting systems such as Xero, having a local accountant isn’t such a big deal.

It’s similar to how people choose Trade Risk for their insurance needs.

In the old days you would use a local insurance broker you could visit, but today tradies can deal with us from anywhere in Australia via phone, email and our online system.

And the results show that tradies love being able to deal with us electronically, and we were even awarded ‘Best Customer Service’ at the Insurance Business Awards,

8 | Aussie Painters Network

despite the fact that we never see 99% of our clients!

Tradies Accountant Office

into it. An accountant or bookkeeper can help manage this process to ensure you’re getting the best out of the system.

It’s no different on the accounting side. Technology now means you can access a national tradie specialist accountant rather than being restricted to your local options.

You certainly shouldn’t look at Xero (or MYOB, etc) as a replacement for an accountant.

If you are someone who does prefer to meet your accountant in person, or you still operate a very paperheavy business, then you might be better off sticking with a local.

We’ve already covered off a few areas which should help you. Factors such as whether you should use a tradie specialist accountant or a normal accountant, and whether you should use a local or an online option.

But if you’re comfortable dealing via phone and email, and you’re more comfortable with using technology for your accounting and bookkeeping, then using a local is no longer an issue.

Do I need an Accountant or Bookkeeper if I use Xero?

First up, how good is Xero? If you’re not using Xero (or any cloud-based accounting system) in your trade business, you should check it out!

Here at Trade Risk we use Xero to manage all of our accounting and payroll needs, and we just love it.

Given how powerful Xero is, a tradie could be forgiven for asking why they’d need an accountant – or bookkeeper – if they’re using it.

First up, if you’re a company you have no choice, so that’s an easy one. If you’re a sole trader, Xero certainly makes it easier to manage things on your own.

Whilst Xero is an awesome tool, it still relies on the data that you feed

Choosing an Accountant

Other than that, one of the major factors is cost. Of course cost isn’t always the best way of judging something, but no one likes to spend more money than they have to.

Above all it’s important to choose an accountant that you’re comfortable with, and one that really cares about helping you and your business.

It shouldn’t really matter if the accountant is down the road or over the other side of the country. If you feel comfortable with them and the cost is competitive, they’re worth a shot.

And anyway, if you’re ever not happy you can always switch accountant until you find the right one to build a long-term partnership with.

www.traderisk.com.au 1800 808 800

2019 April Issue | 9

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10 | Aussie Painters Network

A ONE MILLION DOLLAR BUSINESS The question has been mentioned to me many times, ‘How many staff (employees) do you need to make a yearly turnover of $1,000,000?’

I’m going to try and answer this as simply as possible. There will be a few calculations involved so I hope you’ll be able to follow them.

(Please note that these are just rough calculations as all companies operate differently).

Let’s begin with two important factors that you must be aware of.

They are the ‘Hourly Rate’ and how many ‘Working Hours’ in a year.

1. HOURLY RATE: Hopefully everyone knows how much their yearly business expenses are as from this, you can work out how much you should be charging per hour. Make sure all expenses are included, such as wages, equipment, vehicles and personal income, etc, (materials are not included in your hourly rate as this will vary from job to job).

2. WORKING HOURS: First, let me give you an example of why you need to know this. Let’s say you want a yearly turnover of $100,000 (excluding GST) to pay your wage and all your business expenses.

To bring this to an ‘Hourly Rate’, you

need to divide how many ‘Productive Hours’ you intend to do in a year into your ‘Turnover’ amount. (Productive Hours are hours that you bill your time for, eg, a project is going to take you 100 hours so you multiply that by your hourly rate and then add the materials required. This will give you the total dollar amount for the project. If you price by the square metre, you still need to know what hourly rate you are working off).

Your ‘Productive Hours’ are calculated by the amount of ‘Working Days’ there are in a year; (260) less, annual leave (20), public holidays (10), sick days (10) and an amount for the time you spend quoting and doing bookwork (app. 30 if you look at around 2.5 days per month). This means you are ‘Productive’ for 190 days of the year (260 – 70 = 190). So to work this out at an ‘Hourly Rate’, you do the following calculation.

190 (days) x 8 (hours per day) = 1520 (hours) divided into $100,000 gives you an ‘Hourly Charge-Out Rate’ of $65.79 (GST is not included).

Besides the importance of knowing how much it costs to run your business, there are two other reasons for working this out. 1. If you want your turnover to be the same but want to take more time off, it will of course, change your hourly

rate; for example, 170 ‘Productive Days’ (instead of 190) divided into $100,000, now works out to $73.53 per hour. 2. A lot of people fall into the trap by taking extra days off or leaving work early because they see some (what they think) spare money in the bank. If the job is ahead of schedule, fine.

You deserve it! Remember though it could go the other way and you’re behind schedule. Again! You have worked out how many hours you need to work in a year to pay all your expenses, so taking extra time off when your jobs are taking longer means you are not earning as much, which will inevitably leave you short of cash in the bank.

The best way is to keep a track of every job you are on, so you know if you have time up your sleeve.

Now! To get back to how many staff you need for a $1,000,000 turnover.

First you need an ‘Hourly Rate’ of how much it costs to run your business (let’s say $65.00) and then, how many ‘Productive Hours’ needed to achieve that amount. The calculation for this is quite simple: $1,000,000 divided by $65 = 15,385 hours.

2019 April Issue | 11

Take note that the only people earning you an income is your ‘Productive Staff’. What I mean by that is, people who are physically working on a work site. Estimators, office staff and you (that is if you’re not on the tools yourself) are not included, as these wages should be included as an expense in your overall ‘Hourly Rate’.

The ‘Productive Staffs’ individual hours will be different to a single operators hourly rate (as worked out in the other calculation) because you won’t have the quoting and bookwork factored into it, but let’s assume they work an average of 210 days a year. You can work out the total staff required in two ways.

1. 210 (days) x 8 (hours per day) divided into 15,385 (total hours) = 9.16; or 2. 210 (days) x 8 (hours per day) x $65 (hourly rate) = $109,200 (earnt

12 | Aussie Painters Network

by an employee). Now divide this total into $1,000,000 ($1,000,000 divided by $109,200) = 9.16.

So this means you will need approximately ten (9.16) ‘Productive Staff’ members to give you an annual turnover of $1,000,000.

If you employ this many people though, it will mean a few ‘behindthe-scenes’ staff as well (I can guarantee you wouldn’t be physically working on the tools as you’d be too busy looking after the business).

There would be a need for an estimator and definitely an office person, so all up it could take around 12 staff plus yourself, to make the same turnover of $1,000,000, as the wages on the non-productive staff (including yourself) would have been accounted for in the initial yearly expense. (NB: Material is on top of the yearly turnover, so it will add another 9-15% on the total).

Can I say though that just because you have a lot of staff, it doesn’t always mean you are making a lot of money. For instance in this case, you have two employees plus yourself, that are not productive (physically earning an income). These wages are coming out of what the ten other employees are making you as well as all the other expenses.

So it’s really something to think about if you want to grow your business as it takes a certain type of person to run a multi-million dollar business.

Sometimes smaller can be better. Less hassles. Less headaches. Less stress.

Jim Baker www.mytools4business.com

䴀礀 䠀漀甀爀氀礀 刀愀琀攀 䌀愀氀挀甀氀愀琀漀爀 䴀礀 倀愀椀渀琀 䌀漀猀琀椀渀最 䜀甀椀搀攀 2019 April Issue | 13

FUTURE BUDGETS are going to have to spend more on welfare, which is fine. It’s spending on us This is part of a major series called Advancing Australia, in which leading academics examine the key issues facing Australia in the lead-up to the 2019 federal election and beyond. Read the other pieces in the series here.

Spending on social security and welfare accounts for more than a third of the Commonwealth budget.

Because of its size, it has been one of the main targets of proposed cuts in every Coalition government budget since 2014.

Despite this, social security and welfare spending has continued to grow. In fact the best way to describe the approach of the Coalition’s past five budgets is attempted rather than actual austerity, with the Senate rejecting or never considering repeated cuts. More than A$10 billion of these were served up again and again in budgets as so-called “zombie measures”.

Whoever wins government will continue to face pressure to further increase welfare and social security spending as the National Disability Insurance Scheme ramps up and a royal

14 | Aussie Painters Network

commission and demographic shifts build the case for more spending on aged care.

It is also widely recognised that Newstart, the main payment for unemployed Australians, is increasingly inadequate. It has slipped relative to pensions and wages each year because it is indexed to the slower-growing consumer price index. Payments for single parents are also inadequate, having been cut as a result of specific government decisions.

They say it’s us versus them…

The Coalition has responded with policy proposals that stigmatise recipients, such as drug-testing. It has introduced programs such as Online Compliance Intervention (“robodebt”) and ParentsNext that have arguably overreached in clawing back payments and imposing sanctions.

In 2014, the new Coalition government’s first budget speech classified people whose main source of income was support payments as “leaners not lifters”. In 2017, the human services minister described

welfare dependency as the most pressing problem facing Australia’s social security system, likening it to “poison” for the unemployed.

And yet most of us are recipients at one time or another or have family members or friends who become recipients because of unemployment, ill health or family breakup.

… but we are them During any fortnight, more than 5 million Australians, or roughly a quarter of the adult population, receive an income-tested social security payment. This includes an age pension, a disability support pension, Newstart, a carer’s payment, a parenting payment or one of seven other categories of income support.

Family tax benefits supplement the incomes of around another 855,000 families. And 900,000 or so families, many of them not receiving social security benefits or other family payments, are assisted with childcare costs.

As we look over longer periods, receipt of social security payments becomes ever more common.

The social services minister has used point-in-time administrative data to show that in 2018 the share of working-age Australians on welfare fell to 15.1%, “the lowest rate of welfare dependency in over 25 years”.

But the longitudinal Household, Income and Labour Dynamics in Australia (HILDA) Survey finds that over the course of an entire year (2016) about one-third of workingage households contained someone who received an income support payment for some of it.

The longer the time period, the more common becomes the receipt of payments.

Between 2001 and 2015 around 70% of working-age households included someone who received an income support payment at some point (not including the age pension or family payments).

It is one of the most important lessons of longitudinal surveys like HILDA – we, our family or friends are in this together.

While the likelihood of receiving support is greater than acknowledged, that support is less intense than is commonly believed. HILDA shows that 70% of working-age households received some social security benefits over a 15-year period. Only around 1% of working-age households receive the bulk of their income (90%) from benefits for 10 years or more.

These were people with deep and persistent disadvantage. They were highly likely to be Indigenous Australians or people living in areas with limited job opportunities or people with long-standing disabilities or educational disadvantages.

As the 2016 HILDA report notes: The welfare system does indeed provide temporary rather than long-term support for most recipients, and is potentially playing a very important safety net role.

The social security system is among the core institutions of contemporary Australian society. And it can be regarded as one of the main levers of not just social policy but economic policy. Australian governments have used the social security system to stimulate household spending during recessions or to avoid recessions — as happened during the global financial crisis.

An effective social security and welfare system is an essential underpinning of a modern economy, not least because security when people are in work requires security during periods when people are looking for work or outside the labour market.

Immediate priorities…

The first welfare priority for a new government has to be to increase the Newstart unemployment benefit.

Opposition Leader Bill Shorten has promised that, if elected, Labor will do this via a “root-and-branch review”.

Crossbenchers Rebekha Sharkie and the departing Cathy McGowan want to go further. They have introduced a private member’s bill that would create an independent commission to examine the adequacy of all social security payments other than family payments and payments to veterans.

The commission would make recommendations rather than set rates.

The review promised by Shorten and the ongoing commission proposed by crossbenchers need not be mutually exclusive. An immediate review could be used to increase payments in the short term, while an ongoing commission could examine longer-term priorities.

Another urgent priority should be to reform the employment services network. It operates more like a system of penalties than an employment service, requiring participants to apply for 20 jobs a month or go on Work for the Dole programs rather preparing them for work.

… and beyond

There is a case for going further. We are overdue for a comprehensive review of Australia’s social security system. This should be undertaken in an integrated fashion and include tax, family payments and payments for childcare and to support people who study and work.

Looking further ahead, the ageing of Australia’s population is going to force us to spend more on health and aged care.

Population ageing and increased life expectancy represent a fundamental challenge that will inevitably be met by collecting and distributing more of our economy in tax and benefits than at present.

Peter Whiteford

Professor, Crawford School of Public Policy, Australian National University

2019 April Issue | 15

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The Warning Signs of

NON PAYMENT When I sit in front of my clients and ask them to tell me the story of their payment issue I often hear warning sign after warning sign that my client did not pick up on.

They tell me about what the builder or project manager said or did which were clear signals that payment was going to be an issue. Yet they kept working, oblivious to the dispute that lay ahead.

works, and then retreats back to the contract, and denies any additional agreements.

If you can spot these signs early you can address non payment early. It is better to argue about $20 000 than $150 000.

You have a business relationship. It is ‘fee for service’. Don’t lose sight of that.

I will outline the most common below.

Informalising the relationship You and your client are not mates, friends, or relatives. You are in a business relationship. That means that your relationship is governed by the contract. Keep it that way.

A key cause of disputes is where each party agrees to deviate from the contract in a series of informal works or undertakings. Then the client refuses to pay for those

You all know what I am talking about.

You are entering into these informal agreements because you want to be a ‘good bloke’. Forget it. The contract is the agreement. Any changes need to be run under that agreement.

Dumping the paperwork Often a contract will require certain notices and documents to be completed, sent, signed off etc at certain points. For example you may send your client an Extension of Time [EOT] request. Or you may quote a variation and submit it for sign off.

Now your client does not sign it or respond as the contract requires.

Let’ say you get a verbal approval, or your client refuses to sign or makes an excuse. Then you accept this and go ahead.

You have just left yourself wide open.

Your client will deny approval for any of it. I often see contractors who follow the process as described in the contract, but their client doesn’t. For example an EOT Notice may require a response in writing, but the client does not respond at all. (Clearly to avoid approving any EOT.] Keep to the process. If the contract describes a process for each side to follow then hold your client to that process. Don’t do anything unless your client does their part too. If a variation has to be signed off by the client then don’t start it until it is signed off. If an EOT Notice goes unresponded to, then insist that it is, and send written correspondence noting that your client has not responded.

These are all examples where your client does not want to create written evidence of their agreement to anything that might cost them money. Don’t let that happen.

2019 April Issue | 17

Gone bush Suddenly you can’t get your client on the phone. You know what I’m talking about. Messages unreturned. Faxes unanswered. They always appear to be in meetings.

This is a strong sign of a payment problem. This usually happens in conjunction with other issues. For example you might be calling to follow up on your EOT notice or your variation quote, or when your promised payment will come in.

Don’t accept this and keep working. A good strategy is to first send written notices to your client noting the number of calls and messages you have left and that they have not answered.

Then, depending on what your contract says, you can simply not carry out the work in question. If you haven’t gotten a response from your client then you can claim you have no direction either way and simply not do the work. This will almost always drag your client out of the shadows.

Above all you should be aware that the difficulty in contacting your client has nothing to do with all the ‘meetings’ he is in. It’s is likely to be connected to avoiding payment.

Meetings meetings meetings Whenever you are being called in to meetings to ‘sort out’ things that are already clearly set out in the contract it’s time to be worried. For example the contract might state that you are to be paid 30 days EOM. That date comes and goes without payment. You call your client to ask why you haven’t been paid and they call you in to a meeting to ‘sort it out’.

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Sort out what? The contract states when claims are to be in, the contract states when they are to be paid.

Simple. Yet you are being called into meetings to negotiate various terms and arrangements that are already agreed in the contract.

I had a client that spent months in these ridiculous meetings where all sorts of alternative payment arrangements were put to him. In short his client wanted to vary his contractual obligations relating to payment, while my client was expected to stick to the contract. In the end my client kept working and his client went into administration owing him $70 000.00.

If you must attend these meetings make detailed notes and send your clients Minutes of that meeting. Also I would almost never agree to vary what was agreed in the contract. It’s the thin edge of the wedge.

Ridiculous Payment Schedules This is so common. You submit a claim for $120 000.00 and you get a Schedule for $42 000.00. Too many contractors accept this and continue working. After 4 months you have done $500 000.00 and been paid $135 000.00. This is crazy.

I have looked at these Schedules and they are miles away from justifying such large shortfalls.

Most of the time the client will not argue with the work done but will create a whole series of set-offs claiming defective and incomplete work and damages.

You need to hit these hard straight away. Too many contractors try to ‘have meetings’ (see above) to reason with the client and get more money. Forget it. Your client has to justify every cent that they take off your table. If they can’t, then take the matter to adjudication immediately.

This problem never improves next month. It only gets worse. When you client sees you are willing to work regardless of the low scheduled amounts, they will do it again next time (why wouldn’t they?)

Hit this one hard straight away.

These five warning signs happen in combination or on their own. You need to see them for what they are: signs that you will not be paid.

The key is to act quickly and address them head on. If the relationship breaks down then so be it. You need to protect your cashflow first.

It is better to be in dispute over less money, than over 8 months worth of work. By then you will have no leverage in any dispute and will take anything to get out. Don’t let that happen.

Anthony Igra

For more great articles and video information about dealing with payment problems go to www.contractorsdebtrecovery.com.au

or call us on 1300 669 075

2019 April Issue | 19

Discover a new way to

EFFECTIVELY train your tradesmen and office staff

that provides a Win/Win for you both.

There is a common misconception that talking ‘AT’ your new employees is an effective form of training.

The truth is, employees only retain 20% of a new task when they are TOLD what to do, making the whole process completely redundant.

The other side of this truth is that while they only retain 20% of what they hear, they will retain 90% when they have had the opportunity to physically So why would you want to teach people any other way?

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You wouldn’t put a learner driver behind the wheel having only read a manual or listened to your verbal instructions, right? So why would you do this to a tradie or any new employee in your business?

It reminds me of a quote I read once by Benjamin Franklin“Tell me and I forget, Teach me and I may remember, Involve me and I learn.”

We took this quote literally and implemented it into our own plumbing business…

We developed one page visual flowcharts for each process/system

within our business. A single page that ensures we achieve positive predictable results every time.

We use these in conjunction with our hands on training so that our tradies (and office staff) can follow the steps while actively applying. This way they learn by DOING which helps to speed up the learning process.

Because of this, we’ve shrunk the time it takes to have tradesmen comfortably operating in a truck on their own and following our systems to a tee; from 6 weeks to 2 weeks. Now that’s saying something!

There are plenty of benefits gained by your team when you take the time to help them learn by doing.

Let’s take a moment to discuss 3 of these advantages; #1 Retention Increases Studies have found that university and TAFE students who practice what they’re learning can retain up to three and a half times as much as those who actively listen throughout lectures.

Think about how much and how long you ‘verbally spew’ at your new apprentice or painter at lightening speed. You could have saved hours (and perhaps prevented losing your voice) simply through a 10 minute demonstration with them repeating your actions. Time waster, right? #2 Confidence and Competence Increases New employees who follow the right onboarding process, given the correct training to understand WHY we do things the way we do

(using flowcharts and hands-on application), are WAY happier to follow what we teach.

In addition to that they are more confident in their actions and hence less prone to silly mistakes that can arise from indecisiveness.

Overall the right training, in conjunction with the flowcharts and DOING, has a long-term positive effect on the employee. A win/win for everyone! # 3 Overall Skills are developed Hands-on-learning allows the development of a broader skill set.

Rather than questioning each move (and wasting time in the deliberation), the employee simply follows each step of the one page flowcharts. This helps them gain confidence due to the repetition of their actions.

As a business, your employees are your greatest assets, so why wouldn’t you want to provide

them with the benefits of handson training. Take it to a whole other level and incorporate a one page flow chart to follow!

Whilst in the short term this training process might seem tedious, in the long term your business will benefit as your employees feel valued and their confidence will grow. Trust me, this makes the effort well worth it when you are rewarded with longterm, loyal employees and additional profit to the business!

Interested in learning more about systems for your trade business?

Come check out our live event ‘The Next Level Tradie’ where we show you how we developed the 250+ flowcharts we have in our business and even share some with you!

CLICK HERE to check it out.

Angela Smith

Co-founder – Lifestyle Tradie

“Helping Trade Business Owners Fast-Track Financial & Lifestyle Success”

2019 April Issue | 21

夀漀甀 琀愀欀攀 琀栀攀 猀愀洀瀀氀攀猀 愀渀搀 猀攀渀搀 琀栀攀洀 琀漀 匀礀搀渀攀礀 䄀渀愀氀礀琀椀挀愀氀 䰀愀戀猀⸀ 吀栀攀 氀愀戀 愀渀愀氀礀猀攀猀 琀栀攀 猀愀洀瀀氀攀 愀渀搀 眀攀 攀砀瀀氀愀椀渀 琀栀攀 爀攀猀甀氀琀猀⸀

22 | Aussie Painters Network

The Two Most Powerful Ways to Create a Healthy Eating Pattern The forces we’re up against are powerful:

While most people want to find a way to eat healthier, they are up against forces stronger than they understand.

• Lack of time and energy, so we opt for convenience

Sure, we’d like to eat healthier — but then why do we keep failing?

Why are most of us getting heavier over time, despite our best efforts?

To figure out a better method, we first have to look at the powerful forces we’re up against. Then firm our resolve, and try one or both of the powerful methods that I describe below.

The Forces We’re Up Against Let’s say you’d like to eat a healthier diet … think about what you’re up against: • You wake in the morning and are hungry and in a hurry — you know you want to cook something healthy with vegetables, or maybe some oats with fruits and nuts, but it’s too much work and takes too long.

So you eat a quick bowl of cereal or grab a pastry at the coffee shop.

• You want to get a salad for lunch but there’s a party at work and there are a lot of unhealthy options right there in front of you, very tempting. Or perhaps your co-workers invite you to lunch and you can’t resist getting the burgers or fried foods they’re eating.

• Social forces that cause us to do what others are doing • Tempting foods are too hard to pass up very often — this is a combination of high-reward foods and depletion of discipline

• You want to avoid sweets but then you go to a family gathering and there are delicious desserts passing in front of your nose all day long, and you just go for it.

• You’ve been disciplined about eating healthy for a few days, but at night your cravings for snacks get the best of you and you just pig out. This is your body’s hormone signals at work, telling you to eat because it doesn’t want you to drop below a certain level (your bodyfat set point).

• You are tired, you had a hard day, and you want to just comfort yourself with some snacks (comfort foods).

I’m sure at least a couple of these sound familiar to most of you. Maybe too familiar — you might have been struggling with these for years.

• Our bodies signaling that we should eat when our bodyfat starts to drop (bodyfat set point) • We use food to reward or comfort ourselves, and this is an ingrained habit from childhood Most of us can’t beat all of these really strong forces all the time.

And so we win a few battles but lose the war over the long run.

What can we do against these powerful forces? Are they unstoppable?

No, we can overcome them. It will just take more focused effort than we usually believe when we say, “I’m going to start eating healthier, tomorrow!”

There are two powerful methods that can help us overcome these forces.

2019 April Issue | 23

Powerful Method #1: Change Your Environment

and enjoy. At night, you have fruits you can eat if you get hungry.

Most of the forces above can be overcome with a complete change of our environment. Now, I understand that many people aren’t in complete control of their environment (teenagers, for example, or people living in a family) … but we can still make some changes that will help.

With your environment changed, you will default to healthy most of the time. Then when you don’t have a choice, you can just do your best, and not worry too much about it.

The more of these kinds of changes we can make, the better we’ll do against the forces above. See if you can make more changes than you normally would consider — sometimes when there’s a will, there’s a way to make it happen.

Imagine this: you go through your day with only healthy options to choose from, and you have healthy meals already prepared (you made them on Sunday). You wake up, grab a healthy breakfast, take your healthy lunch to work, avoid the unhealthy places your coworkers eat and instead read a book and eat your delicious lunch. You have healthy snacks packed for the afternoon when your energy starts to dip, and when you get home you have a healthy dinner to heat up

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Some changes to consider making to your environment: • Get rid of all unhealthy food in your home, and only have healthy options. If you can’t do this completely, do it as much as you can.

Talk to the others in your home and ask for their helpl • Plan out some healthy meals and prepare them in advance on Sunday.

• Have healthy snacks available to you whenever you might get hungry.

• Bring a healthy lunch to work.

Find a nice spot to enjoy this meal.

• Find some restaurants with healthy options that you can go to if you want to go with friends. Tell them not to let you order anything but the choices you’ve chosen ahead of time.

• Prepare or buy something healthy to bring to parties or family gatherings. Avoid hanging out near the unhealthy stuff.

• Plan ahead and have healthy stuff to bring for when you travel.

Have healthy options available at work, and avoid places where they have unhealthy stuff.

• Get your friends and family to join you on your quest for healthy living.

Start a challenge. Ask for their help.

Don’t get frustrated if they don’t join you or don’t stick to it.

These are just some ideas. You might come up with others, but these are some examples of changing your environment to support a healthy change. It’s more important than we often realize.

Powerful Method #2: Get Some Support & Accountability The next most powerful thing you can do to make a change is to make it social — get friends, family and/ or co-workers to give you support, join a challenge with you, or hold you accountable for the changes you’d like to make.

This is true for any habit, but it’s especially true for eating habits.

That’s because our friends, family and co-workers are often the biggest influence on us when it comes to eating. If they are trying to make us eat dessert all the time, we will have a hard time resisting that for very long. But if they’re eating healthy meals and snacks with us, or at least encouraging us to do so, we will probably do a lot better.

Some suggestions here: • Join my Sea Change Program to get some support and accountability — we’re doing the Healthy Eating Challenge right now, and it is set up to help you be a success.

• Create a challenge and see if friends and family will join you. Or make it a challenge for your office. Get an accountability partner or two, and report to each other every day. Or at least every week.

• I suggest you join us in the Healthy Eating Challenge in Sea Change — I’d love to have you.

Three Other Things We Can Work On While those are the two most powerful methods of change, there are a couple things that are also pretty important, that I should mention: Change your coping mechanisms. A problem that many of us have is that food is our way of coping with stress, feeling bad, and so on. It’s been that way for years. To overcome this old habit, we have to find new ways of coping with stress, anger, sadness.

When those feelings come up, you have to consciously choose to deal with them in a new way: talk to someone, go for a walk or a run, take a hot bath, have some tea, meditate.

Do this consciously for awhile and soon you won’t need the food to cope. The same is true for rewarding yourself for hard work, by the way.

Practice self-compassion. What do we do when we feel bad about ourselves? Again, we often cope by going to our comfort foods. But instead, we can start to practice self-compassion. Do this regularly and you won’t need the food to feel better as much.

Practice mindful enjoyment of healthy food. People don’t like to

eat healthy food if they think of it as a sacrifice, of eating food they don’t like just because it’s good for them. Instead, try to be mindful as you eat the food, and find something to enjoy about the experience. Can you slowly learn to adore the taste of fruit, of avocadoes, of greens sauteed in garlic and olive oil? Eat slowly, mindfully, and with joy.

These might sound like a lot of changes to make, and they are.

But you don’t have to do them all at once. Make it a project to do some of these changes each week, slowly practicing the new coping mechanisms, slowly changing your environment, slowly getting more support and accountability.

This is doable. You are worth it.

Leo Babauta

a successful ‘simplicity’ blogger and author from California, the creator of top 25 Blog,

ZEN HABITS

2019 April Issue | 25

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Panic attacks aren’t necessarily a reason to panic: THEY ARE YOUR BODY’S WAY OF RESPONDING TO STRESS

Panic attacks typically occur when a person is under stress. The stress can be physical, like being run down, or emotional, like a significant life change.

Panic attacks are a relatively common experience with as many as one in seven people experiencing them at least once. A little more than half of those people will have repeated panic attacks.

Our understanding of panic attacks has changed over time, but we’ve now come to a good understanding of what panic attacks are and how we can help those who experience them.

It’s important to understand that panic attacks are a physiological expression of anxiety, and not intrinsically dangerous. The symptoms are the body’s natural way of coping with perceived threats.

Read more: Explainer: what are panic attacks and what’s happening when we have them?

A build-up of stress Panic attacks are typically experienced as time-limited episodes of intense anxiety.

The effects of stress can accumulate slowly, and a person is unlikely to be aware of the extent of their stress until a panic attack occurs.

Panic attacks often appear to arise for no apparent reason. They can occur anywhere and at any time, including at night, when the person has been asleep.

Panic attacks often have a very abrupt onset and usually resolve over the course of minutes rather than hours.

They are often, but not always, experienced as physical symptoms, such as rapid or skipped heartbeat, difficulty breathing and tightness in the chest, dizziness, muscular tension and sweating.

When someone experiences a panic attack there is also an emotional

response which is driven by perceptions of threat or danger. If the person doesn’t know why a panic attack is happening, or perceives it as something more sinister, they are likely to feel more anxious.

Are panic attacks dangerous?

Panic attacks are not dangerous in and of themselves. They are simply intense anxiety, and the symptoms are real expressions of the sympathetic and parasympathetic nervous system activating and regulating.

An increase in heart rate occurs to improve the delivery of oxygen to our muscles to prepare for action like fight or flight. More oxygen is therefore needed and so breathing rate is increased, resulting in a sense of breathlessness and tightness in the chest.

As oxygen is directed to the core and muscles, supply can proportionately decrease to the head, leading to symptoms of dizziness.

2019 April Issue | 27

The expression of these symptoms will self-regulate, so all panic attacks will cease. However, the residual effects of the body’s chemical messengers, adrenaline and noradrenaline, take some time to “wash out”. So it’s likely that after a panic attack the person will still feel some anxiety.

Again, this serves the function of having the body be prepared to reactivate for any other perceived or real threat. It’s also understandable that after this experience the person will feel tired and drained.

So if you have a panic attack, while unpleasant, it isn’t necessarily a sign that you need to seek help. It may be that through reflection you can use the panic attack as a signal to examine what is happening to lead to the physical or emotional stress in your life, and perhaps make some changes.

When should you seek help?

A small portion of people (1.7%) who experience panic attacks may go on to develop a panic disorder.

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Panic attacks may become frequent and lead a person to avoid situations they perceive as high risk.

Read more: Australians understand depression, so why don’t we ‘get’ anxiety?

In this case the panic attacks become a panic disorder, and it would be useful to seek expert help from a registered mental health professional, such as a psychologist or psychiatrist.

The most effective treatment for panic disorder is psychological therapy (cognitive behaviour therapy) with or without antidepressants.

What can I do to help a friend?

If you see someone having a panic attack, try not to “feed the fear” by responding with anxiety or fear.

Remember and calmly remind the person that while the experience is unpleasant, it is not dangerous and will pass.

Perhaps the most useful thing to do for someone having a panic attack will be to help to re-focus their mind, away from the thoughts that are causing stress.

But you can also give them a sense of control over the physical effects of the attack. This can be done by helping to slow and pace the person’s breathing. There are many variations of this process, but one example is to calmly ask the person to breathe in for four seconds, hold their breath for two seconds, and then breathe out slowly over six seconds.

You can quietly count the seconds with the person and repeat the procedure for a minute or so, or as needed.

---------------------------------------------Justin Kenardy

Professor of Clinical Psychology, The University of Queensland

䘀刀䔀䔀 匀吀䄀䘀䘀 匀䄀䘀䔀吀夀 䌀伀唀刀匀䔀

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匀䄀䘀䔀吀夀 倀刀䤀一䌀䤀倀䰀䔀匀

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䠀䄀娀䄀刀䐀伀唀匀 䴀䄀吀䔀刀䤀䄀䰀匀

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2019 April Issue | 29

How to Make Sure THE PRICE IS RIGHT When it comes to pricing your services it can be hard to figure out the right price. I see a lot of tradies who have been squeezing their own profit margins, and a lot of the times they are not even aware that they’re doing it.

The main reason for a business owner to get into this situation is that they don’t have the big picture of how their business is performing.

They lack an overview of what their true costs of doing business are, which can only be determined when you’ve got a good business systems setup.

Your accountant or bookkeeper can help you work out the best financial system set up for your business to get access to real-time data for job costings, pricing structures, profit margins and overall business performance.

Know the total cost of doing business The key to getting the price right is not just to know your market, but also to know the total cost of running you business and factoring those into your pricing structure

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for each job and for each client. It’s easy to tally up the costs of supplies and materials, but it’s another thing to work out how much of your overhead costs should be factored into the service price.

What’s more, there are direct and indirect labour costs that you need to take into consideration when setting your price point. To achieve this you need reliable data that enables you to make a solid decision on what proportion of indirect costs should be factored into your service price.

When you’re collecting essential financial data via your bookkeeping or accounting systems you are in a position to apply those figures in your job costings. It can help you better understand each service product and determine the optimal price structure. However, factoring costs into your pricing model should not be the only consideration to determine your service price.

Four other models to consider in price setting 1. Competitor-based pricing can give you a benchmark of sorts on what the market pays. However, it’s hard

to know if a competitor is delivering the same kind of service with all the value-adds that you do. You also don’t know what their true cost of business is, and therefore you could run the risk of underpricing right there.

2. Value-based pricing is the trickiest of them all. Value is a subjective judgement by a customer who looks at what they are getting for the price they are paying you. The value they put on your service not only includes the actual service you provide but also how they perceive the customer experience you provide. Using this approach to pricing flips the coin, ie you are determining how much customers are willing to pay, as opposed to determining what’s a fair price based on your true cost of business.

3. Alternative pricing models include price skimming and relationship pricing. Price skimming is what businesses sometimes do when they launch an exclusive new service product in the marketplace.

At first the service is priced high and then lowered over time as other competitors appear on the scene.

processes that regularly feed data into the system for it to be of value.

Streamlining financial administration and feeding data into the system is crucial for business success.

If you don’t know where to get started to get your pricing structure right, feel free to arrange a FREE Financial Health Check with me. Call my office on (07) 3399 8844, or just visit our website at www.straighttalkat.com.au and complete your details on our Home page to request an appointment.

Relationship pricing includes offering long-term contracts and price bundling. For long-term contracts you could add financial or non-financial incentives to make it attractive to customers. After all, it will cost you less in acquisition to have a longterm customer on your books than continually finding new customers.

provide? You can also use split-testing techniques, ie selling slightly different services packages at different prices. The uptake of each package will then give you a clue on what’s more attractive in the market.

Price bundling is usually the combination of two or more services into one price. Telecommunication services are probably the most well known example of price bundling, where the company sells you phone and internet plans with varying data packages and price incentives.

Any accounting software can be set up to store core data such as general ledger, accounts payable, accounts receivable, fixed assets, and bank reconciliation, among others. Set up correctly your accounting system can provide you with crucial financial insights and accurate financial information, all of which you can utilise for guidance in strategic decision making, including pricing.

4. Customer-driven pricing is based on what a customer tells you they are prepared to pay. This information is not easy to tease out. You can ask customers directly, but you may not get reliable answers. There are other ways to find out though when you listen to your customers.

Make sure your accounting system collects the right data

In order to get the big picture, you need the right account code set up and real-time data integration of your business financial systems. Along with that you’ll also need to develop

In addition to getting a review and analysis of your Profit and Loss Statements from the last 3-5yrs, the Financial Health Check also includes an examination of critical business numbers like net profit and margins as well as benchmarking against industry standards.

Please Note: Many of the comments in this article are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.

---------------------------------------------Copyright © 2019 Robert Bauman Call: (07) 3399 8844

Do you hear them say your services are a bargain? Do you find that you lose business due to prices being too high? Or, do your customers say they do not mind paying a little bit more for the quality of service you

2019 April Issue | 31

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Lessons From

Three Pricing Stories One of the biggest success factors for your business is your pricing strategy, and yet it causes headaches for most business owners.

Let’s have a close look at some examples that show what you need to consider when developing your pricing strategy.

The stories in this article focus on three problem areas you can face when pricing your services. If not addressed, they can end up causing big problems for your business.

They highlight pricing mistakes that can happen in any business, in any industry.

Trading for sales vs trading for profit Times were tough, so John decided he had to drop his prices below his competitors. The results seemed gratifying. Business picked up quickly and when John looked round his shop he could see his sales staff were always busy with customers.

Then came the call from his accountant. “Aren’t the sales figures great?” said John, getting his bit in first. ‘Yes”, said the accountant, “impressive sales indeed. That’s the good news. The bad news is that the business has actually lost money over the last quarter.”

This was how John learnt that trading for sales and trading for profit can be two different things. Chasing sales revenue is fine, provided your prices give you a sustainable profit. John hadn’t checked his costs for some time – so the unwelcome news from the accountant came as a shock.

Lower costs are often seen by clients as lower value and lower quality Sue’s PR and media consultancy start-up was struggling to gain some traction in the market. She was promoting a charge-out rate 20% below the industry average, explaining her overheads were

lower than larger companies. But clients were just not biting.

The turning point came after advice from her mentor. “You’re selling yourself short, Sue,” said the mentor.

“With your qualifications and experience in large media companies you should be charging at least as much as other businesses do – if not more.

I understand your marketing strategy, but I don’t think clients see it that way.

They are more likely to interpret lower costs as lower value and lower quality. In your industry confidence goes a long way, so you shouldn’t be afraid of marketing yourself at a price that reflects your expertise and experience.”

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This was how John learnt that trading for sales and trading for profit can be two different things. Chasing sales revenue is fine, provided your prices give you a sustainable profit. John hadn’t checked his costs for some time – so the unwelcome news from the accountant came as a shock.

Lower costs are often seen by clients as lower value and lower quality Sue’s PR and media consultancy start-up was struggling to gain some traction in the market. She was promoting a charge-out rate 20% below the industry average, explaining her overheads were lower than larger companies. But clients were just not biting.

The turning point came after advice from her mentor. “You’re selling yourself short, Sue,” said the mentor.

“With your qualifications and experience in large media companies you should be charging at least as much as other businesses do – if not more.

I understand your marketing strategy, but I don’t think clients see it that way.

They are more likely to interpret lower costs as lower value and lower quality. In your industry confidence goes a long way, so you shouldn’t be afraid of marketing yourself at a price that reflects your expertise and experience.”

Failure to monetize your point of difference The service side of Alan’s computer store was doing reasonably well, but the computers, laptops and tablets he offered were mostly gathering dust. He tried to price as

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closely as possible as the big shed competitors, but that meant there was hardly any margin in each sale.

After a brainstorming session with his advisers, Alan realised it was pointless trying to compete head on with larger competitors who had far more buying power. Alan knew that many of his customers were small business owners so he decided to reposition his business as a one-stop niche store for small businesses and start-ups.

His new point of difference was to offer a comprehensive service package to small businesses that bought his computing gear. The package focused on solving their main pain points, such as setting up new computers, laptops and tablets and networking them effectively; transferring data from previous machines; and setting up the systems, databases and accounting programs they needed to operate efficiently.

Alan still makes relatively small margins on the actual computing hardware, but has enhanced his profit margin considerably by selling his ‘total solution package’ of added services and service contracts.

Conclusion These business stories all show how pricing can be crucial to your success. You must know all your costs to price appropriately and you must know what competitors are charging, without blindly trying to follow them as they may have different cost structures.

It also helps to remember that there’s more profit at the top end of the market, so if price proves a stumbling block, look for innovative ways to add value through compelling points of difference.

A final lesson is that discounting seldom works for smaller businesses. Sacrificing profit margins for sales means you need high sales volumes while bigger businesses can undercut your prices even more in a price war – resulting in a race to the bottom.

Sandra Price

Phone: 07 3147 8322 VISIT US ON FACEBOOK

吀栀攀 瀀漀爀琀愀戀氀攀Ⰰ 椀渀攀砀瀀攀渀猀椀瘀攀 洀攀琀栀漀搀 琀漀 瀀爀攀瘀攀渀琀 瀀愀椀渀琀 眀愀猀琀攀ⴀ眀愀琀攀爀 瀀漀氀氀甀琀椀渀最 琀栀攀 攀渀瘀椀爀漀渀洀攀渀琀⸀

2019 April Issue | 35

Managing Your

SALES EFFORT

One of the myths of paying salespeople commissions is that if they do a poor job, they do not cost you anything. In the old days, some car dealers would throw bodies on the sales floor and fire the bottom guys at the end of the month. Unfortunately, this is not a good way to get the most bang for your advertising bucks. Lost opportunity costs can be huge. Personally, I am not a fan of commission only salespeople but that is another subject and a topic to explore at a different time. Sales is like anything else, the more efficiently it is managed, the better it will become. Here are some simple steps you can take to measure your sales effort.

Measure what you expect: A few years ago, it became fashionable not to keep score in little league and other children sports. Where does success come in life where you don’t keep score? Most people want to do well. If you don’t monitor performance and understand what is going on, how can you be a leader and help

36 | Aussie Painters Network

guide your people? This also goes for company’s where the owner may be the only salesperson. Institute a system to go over your closing ratios each and every month.

Know what you are measuring: To simply count the number of estimates given and divide by the number of jobs won is not adequate.

You should track closing ratios by both number of jobs, by dollars sold and type of lead. It is not uncommon to have a salesperson who sells a higher percentage by the number of estimates given but less when compared by dollars.

For example, a salesperson might sell 50% of the estimates given (200 estimated, 100 sold) but 30% by dollars ($2,000,000 estimated and $600,000 sold). What this might tell us is that the salesperson can sell small jobs but not the big ones. Or your might have a salesperson who sells 30% of the estimates given but closes 60% of the dollars quoted.

This might tell us the salesperson does not consider small jobs important or one large job may have distorted all of the statistics. My favorite story about this is about the commercial company I consulted for and they bragged about selling 33% of the jobs estimated (12 million estimated, 4 million sold).

What is interesting is that one job was 3.5m and when you looked at bids awarded by number of jobs, they had a 4% closing ratio.

Type of lead is also very important.

Make sure you break out repeat customers. Closing percentages are much higher for repeat customers and a salesperson with seniority can rest on his or her laurels. We worked for another residential company that had been in business 50 years that bragged about their salespeople having a 50% closing ratio. With some investigation, we found the company had a huge customer base and following. Closing ratios on advertised leads were less than 20%.

Evaluate post sales marketing expenses. Many company’s track advertising cost by the number of leads generated but this does not tell the entire story. Lead generation has become very expensive and it is important to understand the true marketing costs including sales success.

Suppose a lead cost’s your company $300 in advertising. That means 10 leads cost $3000. If you sold 3 out of 10 leads for a 30% closing ratio that would equate to $1000 advertising cost per job sold. If you sold 6, it would drop to $500 per job sold.

the problems with web lead companies is that they usually give the customer several names and that is an endorsement. If you are on a list with contractors who are sound technically but don’t have a clue of what their costs are, which is much of the market, the low guy gets the job. Consumer ratings can also be misleading. Just because someone is personable, on time and nice does not mean the job will last.

Few buyers go back on line and complain when the job fails two years later.

It is not uncommon for yellow pages and web lead services to generate cheap per lead costs but that does not tell the whole story.

If closing ratios on those leads is low, then the sales and time factors can become devastating. One of

With spreadsheets and other simple financial tools, it is easy to create something to help tabulate results. Easier yet, every estimate has a written copy. Keep an extra copy and tabulate them to do see how you are doing.

So what’s the bottom line? Keep score and track what does and does not work. What works in San Francisco, may not work in Charlotte due to market conditions, number of contractors in your trade or your salespeople’s ability, etc. Salespeople are like other employees. They have personal lives, illness, habits and numerous other things that can impact their day to day performance. You can’t be a sales leader unless you are a sales scorekeeper.

Monroe Porter

is president of PROOF Management a firm that teaches seminars and runs networking groups for painting contractors.

www.proofman.com

Construction Industry Mentoring Flyer BUSY At Work and Construction Skills Queensland (CSQ) have teamed up to offer a new and exciting mentoring program for apprentices and trainees in the construction industry.

Industry Specialist Mentoring for Australian Apprentices (ISMAA) provides individual support to Australian Apprentices and Trainees in the first two years of their apprenticeship or traineeship.

The program is aimed at industries where automation, robotics and other new technology or influences are changing the future roles of apprentices and trainees, and tradespeople.

BUSY At Work are proud to be delivering the ISMAA program on behalf of the Australian Government.

We will work intensively with apprentices to help them stay engaged, complete their training and achieve great things in their careers and to become the great tradespeople of the future.

Our ISMMA mentors have a wide range of experience and understand the changing nature of your industry.

Our Industry Specialist mentors will engage with the mentee to create a specific and individual mentoring plan to be implemented over a 6 month period.

Visits will focus on workplace and industry changes, future career options and new skills that may be required.

BUSY At Work believes this program will benefit all involved and help improve the retention rate of apprentices and trainees in the construction industry.

Tim Gillespie ISMAA Mentor - BUSY At Work 0438 869 227 Tim.Gillespie@busyatwork.com.au Visit busyatwork.com.au/ismaa

Industry Specialist Mentoring for Australian Apprentices (ISMAA) is funded by the Australian Government Department of Education and Training.

2019 April Issue | 37

The case for

“Industrial Manslaughter” Let’s face it, no one wants to get hurt at work, nor do we want to see our colleagues, our mates, be injured either. However, many of us know someone who has had forced time away from work due to an injury sustained at work. A few of us, know someone who has died at work from a work accident. However, some employers will continue to cut corners to save time and/or money on jobs while putting themselves, their employees or even the public at risk of harm or death.

So, what is industrial manslaughter and why was it introduced? To explain this, first I need to explain the concept of a separate legal entity. Many business owners I speak to when asked why they have a company structure, say something along the lines of it protects their personal assets if the company gets sued, or goes into liquidation. The reason this can be the case is that a company is recognised as being separate to the owners or directors of the company, hence why your personal assets can be safe if things go wrong. However here in lies the problem. If a worker is injured while working for a company, in many cases the proceedings are against the company, not the director. However, what happens if it is a criminal offence, you can’t put the company into prison, and the directors are distinguishable from the company.

Previously, it was possible to charge officers and others under the Crimi-

38 | Aussie Painters Network

nal Code for their actions leading to serious workplace incidents. To do this, prosecutors needed to show a direct link between the actions of the officer and the serious incident. This is difficult in many cases for smaller companies, while near impossible for large corporations where there can be several layers of managers between the people at the top, and the workers ultimately affected.

In May 2018, the Victorian Premier Daniel Andrews stated that 234 Victorians have died at work in the past decade. Mr Andrews said on announcing his promise for Industrial Manslaughter to become a new criminal offence that “It’s my sincerest hope that these laws will never need to be used… that instead, they’ll change our workplaces and change our culture.”

There has been some suggestion that industrial manslaughter laws will not be as effective as hoped and may be unlikely to save lives in the workplace. This has centred around the wording of the legislation not encompassing corporate cultures, and more importantly, the lack of deterrence by imposing a potential jail sentence. Since many corporate directors have a clean criminal record, involvement in public and community service, they could benefit from a multitude of character witnesses. The defence counsel would tell the judge that they have already suffered as a result of their actions by

the damage to their reputation and the likelihood that they would not work in their chosen career again.

In 2004 the ACT was the first to introduce Industrial Manslaughter. In the ACT, prosecutors do not need to prove negligence by the officers, simply that a corporate culture existed that tolerated, encouraged, directed non compliance with the relevant health and safety legislation, and a worker died as a result.

So this could be that an employer was using trestles and planks and would routinely not set up the handrails because it took too long, if on one occasion a worker fell and died as a result, then the officers of that company could face criminal prosecution including a custodial sentence. However, it must be noted, that I have not been able to locate a single instance of this provision being enacted.

Jail time a reality for corporate directors This now brings me to Queensland.

While off to a much later start than the ACT with industrial manslaughter being brought into effect in October 2017 , there has been a recent case where a company director, Mr Lavin, was found guilty and served with a 1 year jail term suspended after 4 months and a $1 million fine.

This case was Queensland’s first successful prosecution of a Category 1 offence of reckless conduct.

In the case of Mr Lavin, a company that he was a director of was contracted to perform roofing works to a factory at Cooroy, Queensland.

During this time a worker, Mr Te Amo tragically fell six metres from the “live edge” of the roof to his death.

The cost of installing the safety rails necessary for the work to be completed, was specifically allowed for in the contract price of the job. This would have cost about $5,000, on a contract of almost $300,000. Rather than installing edge protection, the company Multi-Run Roofing and Mr Lavin implemented an alternative system of completing work on the live edge utilising harnesses and two scissor lifts. This method was not being used on the day of the accident.

In Victoria the first prison sentence for a breach of workplace health and safety provisions was handed down in December 2018. Ms Jackson, 72, who owned a scrap metal yard, was sentenced to six months in prison, and ordered to pay a $10,000 fine after a person fell from the tynes of the forklift and died as a result of the accident.

Ms Jackson was charged, and pled guilty to two charges under the Occupational Health and Safety Act 2004 (Vic) for; failing to prevent other persons from being exposed to risks arising from her undertaking, and recklessly engaging in conduct that places or may place another person who is at a workplace in danger of serious injury.

So, what does this mean for employers?

People have previously received suspended sentences in Queensland and Victoria, and individuals have received custodial sentences under the Criminal Code following

serious and catastrophic workplace health and safety incidents, however the recent verdicts in Queensland and Victoria have demonstrated that the prosecutors and the courts are taking their new powers under industrial manslaughter provisions seriously.

I have heard employers, supervisors and employees say that they believe that the job of the state’s Health and Safety regulators is to make life difficult for the person doing the work, that they don’t care about safety, only what their clipboard says, or that they just want to drive people out of business by making it too difficult to comply with legislative requirements. Through my interactions with Workplace Health and Safety Inspectors, this is not the impression that I have got. They seem most concerned with preventing workers from being injured or killed while earning an income to support their families. If there is a failing though, they are prepared to hand out improvement notices, issue infringements or refer the case to prosecutors. The role of Inspectors is demanding and, in many cases, thankless. There are similarities to police too, in that no one enjoys it when they are handed an infringement notice (traffic ticket) by a police officer, however most are very grateful when the police turn up in situations when they really need the assistance.

Complying with health and safety legislation, regulations and codes of practice should not continue to be viewed as ‘optional’ by employees or their employers. The consequences are serious. The punishments are also serious. Is saving some money on your next contract worth risking up to 20 years in pris-

on (individual), or a $13,055,000 fine (company)? No, that is not a typo, the maximum penalty for a company structure is $13 million – plus a few thousand, however what’s a few thousand when you’re already in the millions?

Stay safe out there everyone, because as bad as the punishments sound for non-compliance, do you think you could live happily for the rest of your life knowing that your actions (or inactions) led to the serious injury or death of someone that you employ, someone you work with, a mate?

----------------------------------------------

James Thompson

Former painting contractor.

Currently studying Bachelor of Commerce in Employment Relations and accounting at Griffith University. https://www.linkedin.com/in/thompsonj/

Any possible leads for an employment opportunity in this sector would be greatly appreciated, please contact me on LinkedIn or 0477 108 176 if you may be able to help a fellow painter.

The information contained in this article is for general interest only.

The content does not constitute legal advice and should not be relied upon as such. The application and impact of laws can vary widely depending on specific circumstances. Specific legal advice should be sought from an independent professional before acting upon information contained in this article.

2019 April Issue | 39

The Industry

Idiots

40 | Aussie Painters Network

Important Contacts Aussie Painters Network www.aussiepaintersnetwork.com.au

Ph. 0430 399 800

National Institute for Painting and Decorating www.painters.edu.au

Ph. 1300 319 790

Australian Tax Office www.ato.gov.au

Ph. 13 72 26 / Ph. 13 28 65

Award Rates www.fairwork.gov.au

Ph. 13 13 94

Fair Work Building & Construction www.fwbc.gov.au

Ph. 1800 003 338

Mates In Construction www.matesinconstruction.com.au

Ph. 1300 642 111

Workplace Health and Safety Contacts Comcare WorkSafe ACT Workplace Health and Safety QLD Victorian WorkCover Authority WorkCover NSW SafeWork SA WorkSafe WA NT WorkSafe WorkSafe Tasmania

www.comcare.gov.au www.worksafe.act.gov.au www.worksafe.qld.gov.au www.vwa.vic.gov.au www.workcover.nsw.gov.au www.safework.sa.gov.au www.commerce.wa.gov.au/WorkSafe/ www.worksafe.nt.gov.au www.worksafe.tas.gov.au

1300 366 979 02 6207 3000 1300 362 128 1800 136 089 13 10 50 1300 365 255 1300 307 877 1800 019 115 1300 366 322

www.actcancer.org www.cancercouncil.com.au www.cancercouncilnt.com.au www.cancerqld.org.au www.cancersa.org.au www.cancervic.org.au www.cancerwa.asn.au

(02) 6257 9999 (02) 9334 1900 (08) 8927 4888 (07) 3634 5100 (08) 8291 4111 (03) 9635 5000 (08) 9212 4333

Cancer Council Australia ACT NSW NT QLD SA VIC WA

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