thinkBIG Le a d e r s B u s i n ess Mindset Wea l t h
$7.95 inc GST Volume 2.4 Dec 09/Jan10
Verne Harnish
Think fast, learn hard SEVEN top tips for business success SEVEN ways to distinguish yourself SEVEN stages of property development How to change your negative thinking
MICHAEL J FOX The secret of his foundation’s success
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CONTENTS
12.
REGULARS 6 Editor’s Letter 8 As You Think 66 Inspiring stories 68 Thought Leadership: Books to make you thinkBIG 70 Dream Big: California knows how to party
section1:mindset 20 Kym Tucker: Encourage your kids to be financially independent 22 Andrew Vincent: Develop an entrepreneur’s mindset 24 Bridget Thompson: Who are you? 28 Jenetta Haim: Time to change negative thinking
Michael J Fox: Bright lights, big cause The quest for a cure for Parkinson’s Disease is an arduous one, but Michael J Fox is making the most of his disease by dedicating his life to funding the search for a cure.
section2:business 34 Darren Brown: Retention of title 42 Damian Kay: The FCA and you
section3:wealth 53 Lachlan Elsworth: Make your day trading, smart trading 55 Chris Howard: The greatest investment you’ll ever make 56 Jamie McIntyre: Multiple streams of wealth 58 Aussie Rob: Starting smart makes sense 59 Jack Delosa: Learning from the young rich
70.
features 16 Sometimes it really is who you know
After a life of hardship, Amanda Peros discovers that strong peers and
mentors can make all the difference to leading a successful life.
18 Coach, council or mentor.
Roger Cooper looks at why coaching may seem to be a set menu quick fix
for performance problems or expectations.
26 Discipline – the secret to success
Michael Moore explores the nature of discipline and how you can use it to
your advantage.
30 Verne Harnish: Fast Thinking
The man who created the Entrepreneur’s Organisation talks about growing
your company in tough marketplaces.
39 The money isn’t in the widget
Sharon Pearson shares her top 7 tips for business success.
46 Brothers in arms
In spite of the doubters, Bill and John Fotiadis have built their Souvlaki Hut
franchise into a 28 store, nationwide family restaurant phenomenon.
48 How to grow your company — fast
Alan Chapman explains what it takes to become one of the fastest growing
companies in Australia.
50 Walking the Beeton track
Juston Beeton speaks to thinkBIG about becoming a millionaire at the age of 24.
60 The wall of defensiveness: 7 ways to tear it down
Ari Galper explains that you can no longer rely on what you are selling to
distinguish yourself.
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our team
EDITORIAL Winds of change
Publisher Graham Maughan graham.maughan@thinkbigmagazine.com Ph: 02 9994 8963 Fax: 02 9994 8008 Managing Editor Jonathan Jackson jonathan.jackson@thinkbigmagazine.com Subscriptions Manager Amanda Peros amanda.peros@thinkbigmagazine.com Ph: 02 9994 8963 Fax: 02 9994 8008 National Sales Manager Mark Robberds Ph: 02 9994 8963 Fax: 02 9994 8008 mark.robberds@thinkbigmagazine.com Directors Ken Wood Reuben Buchanan Contributing Editor Chris Howard Contributors Aussie Rob, Darren Brown, Jack Delosa, Lachlan Elsworth, Jenetta Haim, Chris Howard, Jamie McIntyre, Michael Moore, Michelle Murchison, Bridget Thompson, Kym Tucker, Andrew Vincent Creative Design Maria Conti – Graphic Designer Website/subscriptions www.thinkbigmagazine.com Enquires info@thinkbigmagazine.com Mindset Media Pty Ltd ACN 129 256 300 ABN 94 129 256 300 GPO Box 519 Sydney Australia 2001 Ph: 02 9994 8963 Fax: 02 9994 8008 thinkbig Magazine ISSN: 1835 7733
Important Message – Copyright and Disclaimer thinkbig magazine is owned and published by Mindset Media Pty Ltd (ACN129 256 300). The publisher, authors and contributors reserve their rights in regards to copyright of their work. No part of this work covered by the copyright may be reproduced or copied in any form or by any means without the written consent of the publisher. No person, organization or party should rely or on any way act upon any part of the contents of this publication whether that information is sourced from a website, magazine or related product without first obtaining the advice of a fully qualified person. This magazine and its related website and products are sold and distributed on the terms and condition that: •The publisher, contributors, editors and related parties are not responsible in any way for the actions or results taken any person, organization or any party on basis of reading information, stories or contributions in this publication, website or related product. •The publisher, contributors and related parties are not engaged in providing legal, financial or professional advice or services. The publisher, contributors, editors and consultants disclaim any and all liability and responsibility to any person or party, be they a purchaser, reader, advertiser or consumer of this publication in regards to the consequences and outcomes of anything done or omitted being in reliance whether partly or solely on the contents of this publication and related website and products. •The publisher, editors, contributors and related parties shall have no responsibility for any action or omission by any other contributor, consultant, editor or related party.
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he wind blowing through Santa Monica Pier is a gusty one in the early Autumn months. In spite of the 20 plus degrees (that’s 70-something Fahrenheit for our US friends), the chill in the air acts to remind us that the full force of nature is never more than a short bus ride away. When you turn your back on that gusting wind and walk forward towards the famous Santa Monica Ferris wheel, nature will attempt to keep you close by, at times forcing you backwards. It’s never strong enough to cut through your resilience completely, when it matters most you’ll plough through the wind and make it back along the pier to the sand and the highway beyond, but while you’re battling the elements Mother Nature gives you a great opportunity to reflect on human nature and the behaviours that bind our successes and failures. I discovered in that brief sojourn, and in my own moment of clarity, that no matter what winds are holding you back you have to continue to forge ahead, even if you have doubts about a particular moment or situation that weighs heavily on your mind. In my moment of clarity, I bit the bullet and achieved something I had been putting off and making excuses for since I had arrived in the United States three weeks before. My problem was I didn’t quite understand when the right time to achieve my goal might be. What I learnt is that there is never a right or wrong time, there is just the moment. I learnt that when you desire to achieve something, there is no point in continuing to delay. I learnt that the window of opportunity is open whenever you need it to be, however the quicker you take the opportunity, the more likely you are to make yourself and those around you happier. So in battling those metaphoric winds of change, I came to the conclusion that doubting yourself and your motives is your worst possible scenario. To achieve anything you want in life, or to die trying, you have to take your opportunities, and make the most of them. Like our national sales manager, Mark Robberds did recently. Channeling the spirit of Tiger Woods, while Tiger was in Melbourne recently, Mark made the perfect swing, hit the perfect ball 178 metres on a par three at Mona Vale Golf Club and scored a hole in one. Whatever elements Mark may have been battling that day, he too overcame them and by thinking big (and long) achieved what very few professional golfers ever do. It just goes to show that anybody can do anything once they set mind to the goal at hand. TB
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thinkBIG cover story Michael J Fox turned his attention from acting to a bigger, more noble cause: that of funding research into the as yet incurable neurological disorder Parkinson’s disease. He has taken on that role with the optimism and energy we came to love seeing him on screen.
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lex P Keaton, 1980s poster boy for conservative American values, was the unlikely Family Ties character that catapulted Michael J Fox to stardom. Roles as Marty McFly in the Back to the Future trilogy and as Mike Flaherty, deputy mayor in Spin City, cemented Fox’s place in film and television history. For those of us who grew up in the 1980s and ’90s, Fox is part of some of our fondest memories. As Keaton, he summed up the mood of an era falling somewhere between Gordon Gecko and Ferris Bueller. Politics and family played a large role in the Family Ties storylines, the program dealing with issues that conservatives and liberals would freely if sometimes heatedly debate: the politics of greed, the policies of Ronald Reagan, capitalism versus socialism… But this isn’t the story of liberal versus conservative politics, even though those delineations have played a major role in the Foundation and legacy we are about to discuss. This story is about Michael J Fox, one of the best loved actors of his generation and his fight to fund a cure for Parkinson’s disease, the same disease he was diagnosed with in 1991 at age 30.
Casualties of war Nearly five million people worldwide live with the degenerative neurological disorder, Parkinson’s Disease. Currently, no treatment has yet proven to stop or slow the disorder’s progression. The morality-based arguments pertaining to certain forms of research including embryonic stem cell tests seem to have slowed research, yet as William Saletan wrote in online magazine Slate: “Proponents of embryo research are insisting that because we’re in a life-and-death struggle — in this case, a scientific struggle — anyone who impedes that struggle by renouncing effective tools is irrational and irresponsible,” Mr. Saletan wrote. “The war on disease is like the war on terror. Either you’re with science or you’re against it.” Saletan, although biased in his views, does make the valid point that to pursue or not to pursue is a moral choice and moral choices inevitably end up in political debate. Political procrastination, red tape and box ticking unfortunately slows research and funding down. And funding is vital if scientists
are to continue their war against those diseases that ravage the body and inevitably, the human spirit. Michael J Fox, who through the MJF Foundation, has raised over $150 million in his search for a cure for Parkinson’s Disease. In this fight he has proven that the energy and spirit he showed on television and in film, is just as vital off screen. If there is an optimistic take on Parkinson’s Disease, it is Fox’s: “It opened up other possibilities to me. I went in directions I could not have gone.” In 2009 Fox released his follow up to the bestselling memoir, Lucky Man titled Always Looking Up: The Adventures of an Incurable Optimist. The book explores the optimist theme through his travels to Bhutan to learn about Gross National Happiness, to the golf range to discuss positive thinking with actor Bill Murray and to England where a scientist confirmed his optimism as part of his genetic make up. “She has this test she developed where she identified genetic markers of people who have increased serotonin output and are born optimistic, and she did it on me,” said Fox in a radio interview. “There is a second part where you are given a series of images, one horrific and one benign or sentimental, and depending on how you respond, it is further proof. I was attracted to positive images.” The best way for Fox to fight his personal battle, was to fight it on public territory. Optimism is yet to beat his disease, but the MJF Foundation is doing all it can to raise awareness and lift the spirits and hopes of those who suffer.
City spin At first, Fox tried to hide his disorder. A twitchy pinky finger presented as his first symptom in 1990. He was diagnosed a year later and kept the disorder a secret for another seven. However, while working on Spin City the symptoms exacerbated and neither working more nor drinking more could hide the fact that Fox had a problem. Logistics, he says, got in the way of creativity. There was nowhere to hide and no more tales to spin. He quit drinking and went public with the news. Trying to come to terms with his disorder, he had an epiphany.
Bright lights,
BIG CAUSE
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thinkBIG cover story was underfunded. Optimism comes third to politics and money and his support for more funding and for stem cell research became just as big a fight than that of his war against Parkinson’s. Legislators held firm, particularly during the Bush Administration, moralists protested and even conservative US talk show host Rush Limbaugh commented that Fox was either exaggerating his symptoms or deliberately went off his medication when he appeared in political ads. Limbaugh even went to the lengths of mocking Fox’s movements. “I saw the footage of him doing that and I was mad, not for me but it stigmatised this whole community of people,” Fox said. Initially Fox was looking for a cure, but as he matured with the problem he came to realise that research would take him on a long road. Support has come from the New York financial community, helped in part by his role on Family Ties. “When I started the foundation, all these Wall St guys grew up idolising Alex. So in a way their help with the Foundation was a way of giving back,” Fox told The Costco Connection. The MJF does not focus on patient advocacy but is dedicated to the eradication of Parkinson’s through direct funding to research. “Studies that we are funding are not … limited to drug therapies or potential cures but (are) also into the effects of exercise and diet, psychology and attitude.” Those suffering the disease may not always share Fox’s ‘positive’ genetic make up. “I always qualify my mental attitude …with the acknowledgement that depression is a very real part of this for many people and it’s just something from which I’ve been spared. You can have all kinds of positive feelings about life, but it’s cancelled by this ‘house’ sitting on you every day,” Fox tells Costco Connection.
Doc Hollywood
Fox noticed while swimming, an injury to a turtle’s flipper. “I don’t know what kind of symbol that turtle was, but I knew there were places to go,” Fox told an audience at a City Arts and Lectures event at Herbst Theatre in San Francisco. “I was struck by its ‘survivorhood’.” That’s when Fox quit his day job and found his “life work.” He also struck up a friendship with cancer survivor and advocate for cancer research, Lance Armstrong. Inspired, Fox threw himself into the Michael J Fox Foundation which he Chairs, but does not run. He refers to himself as a high school dropout who has surrounded himself with brilliant business and scientific minds. He told writer Rosemary Ellis, “When I started it, I thought, I’m not smart enough to do this. I had no experience in management, no experience in administration, no experience in non-profit; but then this phrase came into my head: I only had to be smart enough to find people who are smarter than me; I only have to be smart enough to recognise who knows more than me.” There is another factor to the Foundation’s success, which the New York Times coins as ‘the most credible voice of Parkinson’s research in the world’, and that is Fox’s enthusiasm for the project and, of course, that eternal optimism. However he didn’t want to be a poster boy for the cause, he wanted to become involved and did so in Congressional hearings where he testified to the fact that Parkinson’s
Living with the disorder as well as using his public image to promote the Foundation is a delicate balancing act. He has to co-ordinate his medication to gain full control of his body in conjunction with his appearances, but it has become a necessary part of life and something he has accepted. Fox also sees the positives to his life brought about by Parkinson’s. “There are things that I can’t do to the extent that I used to do, or in some cases, at all. But there are more things that I do that I didn’t do before. We sometimes see subtraction when we’re ill. They’re not just subtractions. I’m not me minus anything; I’m me plus the experience. Whether it’s good or bad is a subjective thing, but this has assuredly changed my path. And changed the way I look at things. And changed the way I do things. I started this Foundation; I wrote two books now…I’ve seen the reaction people have to my message, which is a positive message and a message we can change things not out of panic but out of hope and a sense of purpose.” In every role he has played, Fox has exuded energy. Whether on set, or in life that energy is infectious and has influenced and inspired his audiences. He may not be a doctor, but this favourite son of Hollywood has cured people in ways that some real doctors can only dream of. It is best then to leave you with why he named his second book Always Looking Up. He told Rosemary Ellis, “People say ‘How do you achieve this?’ And you hear, ‘Just keep your head down’. But I find the opposite is true: Keep your head up.” TB
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thinkBIG your story
Sometimes it really is who you know... By Amanda Peros
At the age of 16, I became involved in a relationship which proved to be detrimental to my life path.
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oo young to realise this, the years passed until my early 20s when I started to become increasingly restless. I would spend hours staring out the window, feeling trapped and excluded. My life was full of violence and turmoil and seemed to be getting worse as time passed. I had become complacent and adopted a ‘poor me’ attitude. All the goals I had as an ambitious teenager – I started careers in hairdressing, pre-school teaching, real estate and tried my hand at various other careers – all left me feeling unfulfilled. It wasn’t until I reconnected with a very wise friend of mine who told me a few home truths, that I realised my destiny was my own making. It was a hard lesson to learn and it took me a long time to figure out how to turn this bit of wisdom into a plan of action. As fate would have it, my stepfather offered me some casual administration work. I accepted the position, unaware that I was about to take on a role that would lead me to turn everything in my life around. The day I started I was overwhelmed at meeting so many ambitious successful people, many younger than myself. I soon found my feet and everyday became more positive than the day before; I had a job I enjoyed, I felt validated and I was given control over my area of work. I began to feel as though I was a part of something. The news that I had Stage 3 Cervical Cancer shattered me. I felt that as soon as I had some positivity back in my life, the rug was pulled out from beneath me again. I fell into serious depression and wasn’t able to pick myself back up. Those few months were a blur. Between doctor appointments and the turmoil at home, I put all my focus into work and for those eight hours twice a week could pretend I knew what I wanted out of life and most importantly… how to get it. Another friend taught me to meditate and quiet my mind; I found this quickly became part of the day I would most look forward to. I will never forget the day the realisation came that I had only just begun my journey in life and that everything I was going through would give me the strength I needed to keep going. Instead of despair and angst I felt hopeful and excited at the prospects that lay ahead of me.
I had treatment for the cancer, which was successful and after a short recovery was back feeling fine. This meant I could pour all my energy into the next stage of my life makeover. I was introduced to a woman who was looking for a personal assistant to help her with her extremely successful branding company.
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It is always easier to stay in something that is not working, however making the change to where you want to be is the part that takes courage.
I was so overwhelmed and in awe of her when I met her. She was confident, strong, intelligent and focused. Everything I aspired to be. However, I let fear get in the way again: fear that I would let her down, fear that I would not be good enough and would never be able to measure up to her standards. This combined with my tumultuous home life and lack of support there, meant I felt I had no choice but to decline the position. Someone once told me that soul mates are not people who you have everything in common with, they are people who come into your life to inspire or impact your life in some way. This woman was the first of many for me. Willing to change but not really sure where to go from there, her advice and direction as well as the support of my amazing friends led me to leave my husband and start out on my own for the first time in my life. I was excited, scared, hopeful and devastated all at once. Now I am a 24 year old ‘single’ mum of a gorgeous two year old son, trying to juggle making a career for myself as well as motherhood. At first, things seemed to get worse, it was all so hard and even though I had little support at home before, I now had none. Trying to deal with a messy separation and keep everything going was incredibly hard. It wasn’t long before things settled and everyday I would be more and more inspired by the people around me. I was amazed at how willing people were to share their wisdom and at the lengths they would go to help me find my path. These people are amazing entrepreneurs, running businesses as well as teaching others how to build a successful company. They are the most dedicated and intelligent people and I found the more I surrounded myself with them the more their attitudes seemed to rub off on me. I was soon thinking in the way they did, knowing I could achieve whatever I put my mind to and that nothing was impossible. I had as much potential as the next person. One year on I am now a Business Development / Subscription Manager working four days a week. I wake up every morning excited and anxious to see what the day brings and what I can do today to bring me one step closer to achieving everything I ever dreamed of. I will be forever grateful for those seeing the potential in me, even when I could not see it myself. So you see, sometimes it really can be a case of who you know and that with the right attitude nothing is impossible...nothing. It is always easier to stay in something that is not working, however making the change to where you want to be is the part that takes courage. No matter what your situation may be and despite any or all the people in your life who tell you can’t, you should know that you can. You just need to have the right mindset and thinkBIG! TB
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thinkBIG feature Many managers wonder what kind of support will be the most effective for their subordinates. As a result they often apply behaviour linked to a relatively new buzz word in business called ‘coaching’.
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oaching may seem to be a set menu quick fix for performance problems or expectations. Scenario 1: Jane Doe is behind on budget for the third straight month on the back of a record year, what should I do?. Answer: Coach her on what you would do, she’ll be right. Scenario 2: The usually reliable Joe Blogs work ethic is somewhat of a concern, what should I say? Answer: Just coach him on what you expect, he’ll be fine. In fact coaching may wear many hats: disciplinarian, instructor, counsellor and mentor. In reality coaching is a practical approach by a coach/manager and a pupil/subordinate of using collaborative dialogue to set goals and achieve results within an agreed time frame. It is important that managers are adaptable facilitators of coaching, counselling and mentoring so that they can provide the appropriate level of support to those in need. More importantly managers should identify the root cause of the problem to determine which method is most appropriate. Executive coaches do not set out to teach or instruct their pupils, they are best described as facilitators using 360 degree feedback which encourages the learner to learn for him/herself. Pupils expand their skill competencies, build on their problem solving confidence and deliberate their options in a non-threatening environment. Executive coaches work on the principal that self empowerment often leads to the most satisfying outcomes. In the case of Jane Doe, her sales manager could choose to accompany Jane on some of her sales calls to observe the root problem, encourage Jane to speak up about any issues, concerns or problems and potentially build a list of action plans for improvement together. Alternatively mentoring may be an appropriate way to deal with Jane or Joe. Mentoring is best described as the way to show a person how to overcome difficulties, avoid dangers and be politically savvy, delivered by an appropriately experienced, wise and helpful teacher, friend or protector. I once worked for a national retailer that delivered what they called a coaching program for line managers. Store managers labelled ‘instore coaches’ imparted their wisdom of operational procedures, supplier relationships, cultural expectations, high margin/impulse products and customer service standards. Seems like a mentoring program to me. Counselling is turning around poor performance. The traditional purpose of counselling is to review the past; this is also in the
methodology of coaching, however coaching is more concerned with goal setting and SMART (specific, measurable, achievable, relevant, timely) objectives. If Joe’s manager takes the time to find out why his work ethic has slipped, she can determine what kind of support he needs. As an executive coach, people ask me what are the keys to being successful? Whether you are wearing the coach, mentor, counsellor, instructor hat, your role is determined by the needs of the pupil. You must understand those needs and gain their buy-in of the process to be effective. This can be achieved through rapport building and active listening. Pupils will get the most benefit when they acquire the skills to be more self-productive, independent and responsible. TB
Roger Cooper is an executive coach with sales and marketing consulting experience to many small and medium enterprises. www.onyourwaycoaching.com.au
By Roger Cooper
Coach, counsel OR
mentor?
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thinkBIG mindset thinkbig
kid start
more interest and you may choose to reward them with bonus interest as they reach their goals.
Allocate a living allowance
Encourage your kids to be financially independent By Kym Tucker
There have been some alarming stories of teenage debt, youth bankruptcy and easily obtainable finance. As parents how can you promote financial awareness and independence in your children? Be aware of what you are teaching
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hat are your financial beliefs? Did you grow up believing the only way to obtain money is to study or work hard? That money doesn’t grow on trees? To be wealthy is selfish or means sacrificing happiness? Whatever you believe you will be teaching your values to your kids through your language and actions (usually without realising). Your financial choices are based on what you deem to be important and the related consequences which impact how you prioritise your funds. Expose your kids to all aspects of your day to day and larger financial purchases, not necessarily the dollar details but the mechanics. Discuss it openly, along with possible variables such as increasing income, reducing other expenses or saving. When using credit cards explain there is a predetermined value the bank has agreed to lend you. After a contract is signed outlining the bank’s full terms and conditions they send regular statements and if not paid in full a penalty is charged. When borrowing for a home or car explain you make regular repayments which include interest, so the total cost of the purchase is more than the original price. You don’t have to change what you do, just teach the logistics so your kids can make decisions based on what they consider is fair exchange to develop their own priorities and choices.
Adapting to a changing environment For many people earning extra income entails working harder or for longer hours. Working hard can develop determination, focus and persistence which are valuable lessons, but our kids want to be fulfilled and enjoy what they do. So siphon these lessons around their interests.
Many of today’s wealthy Australians develop an early awareness of their purpose or niche, utilise their natural or developed skills, demonstrate passion for what they do and seize opportunities in a changing environment. What natural skills and passions has your child developed as they have grown? When you see glimpses, hone in on them, support and encourage their development, help them research what they enjoy and ask a lot of questions. You don’t have to agree with their conclusions, just support the process.
Planning and setting goals Involve your kids when planning for holidays or special events. Setting goals, planning and managing money are vital lessons and help determine what’s important: priorities, wants and needs. When your child wants the latest new product trend, have them research the cost and either plan how to raise the money or determine how long it will take to save. Allow them to experience the consequences of their decisions and actions. How we manage our money is more important than how much we have.
Encourage regular saving Books, seminars and wealth programs advocate ‘pay yourself first’ which is holding a portion of your income in savings. This is a vital habit to encourage your kids to develop so they can experience growth with compounding interest and the success of diligent saving. When you give pocket money or pay for chores, set up a regime for them to save a minimum portion, such as 10%. As an incentive to start you may like to match what they save. Choose an easy routine, such as separate money boxes or jars for younger children and separate bank accounts for older children to match their saving goals. Choose an online saving account to earn a little
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Expose your kids to all aspects of your day to day and larger financial purchases, not necessarily the dollar details but the mechanics.
Sit down with your kids and work out how much they need to live on. This discussion would need to determine your own budget, age appropriateness and expectations of you and your child’s requirements. For example they could buy their own clothes, gifts and mobile phone cost while you continue to provide school costs, holidays and household items. Negotiate variables raised to cover all possibilities and enhance success. Once negotiated, write out clear details and expectations, such as what happens if the agreement is broken, as kids will quickly find loop holes. When complete ensure all involved sign the agreement. This is a great way to support reading and understanding contracts before signing. Most new projects have teething problems, so give your kids a break if they run into strife and use it as a catalyst for discussion and solutions rather than chastising or lecturing. Act consistently with your contract as your kids won’t attempt to spend within their budget if you are constantly supplementing their allowance. Once they have established a pattern, rewards can promote gratitude and continued success.
Money from multiple sources Financial independence is usually achieved from more than one source. A core activity utilising skills could be supplemented with one or more passive income streams. Finding a way for kids to be paid to do what they love is more efficient and satisfying. Have a brainstorming session with family or friends. Accept anything expressed, sometimes it is the simple or even silly ideas which can be developed. Young entrepreneurial minds will have plenty of suggestions if you ask, listen and value their responses.
When kids ask for money – act like a bank Rather than dipping into your pocket, agree to lend a negotiated amount, with an interest rate and repayment schedule. Ensure it is written down, maybe in a simple table. Include consequential payment defaults such as extra interest or late fees. This suggestion requires discipline and won’t work in all families, so implement only if you know you will adhere to it, or your kids will quickly learn skills for avoiding responsibilities and breaking agreements, neither of which will work with lending organisations. We often learn valuable lessons by failing, so don’t be too quick to jump in and protect your kids from their experiences. Build a safety net, be ready to catch them and discuss their experiences in a non-judgemental way so they learn from their mistakes. Mastering financial concepts while still living at home may prevent costly lessons as adults. TB
Kym Tucker is a parent, teacher, business consultant and life coach who develops empowering programs to raise awareness for parents and businesses. www.journeyofdreams.com.au
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thinkBIG mindset
knowledge Develop an entrepreneur’s mindset – the first step to succeeding in business By Andrew Vincent
As the creator and producer of a television series on business success, I was fortunate to have the opportunity to interview over 120 of Australia’s leading entrepreneurs.
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ne of the most common questions I am now asked is why are some business owners extremely successful, while others struggle to make ends meet and never move beyond the four walls of their home office? Before I answer this question, I always ask them why they think some people are successful and others struggle. The common responses include: rich parents, good luck, higher education, smarter, great sales people, hard working and risk takers. The answer could be any of the above, but no one has ever come up with what I believe is the main reason, which has everything to do with attitude. When the successful entrepreneur first decided to go into business, many people wished them well but others told them all the reasons why they would fail. So before they even started their business, they were busy defending their ideas to friends, family, banks, accountants, suppliers, customers and employees. As the business owner they were responsible for everything. Even if they didn’t know the answers, they often had to feign knowledge, stand by their decisions and get the business moving. So, what is the most important reason why some entrepreneur’s succeed and others don’t? It is attitude to learning and knowledge. I call this the Entrepreneur’s Mindset.
What is the Entrepreneur’s Mindset? Most people just don’t get what is required to succeed in business because they focus on the wrong things. A good starting point for understanding where the owner’s
Based on all the interviews I did and working with hundreds of business owners as a business coach, here is a proven method for creating an Entrepreneurial Mindset.
Prepare your mind • Admit that you ‘don’t know what you don’t know’. • Accept that it is OK (Often people can feel the weight lift off their shoulders.) • Be prepared to start learning.
Do your research, learn and ‘Just Do It’ 1. List your three key challenges or frustrations. 2. Decide if you REALLY want to fix ONE of them. Focus is the key. 3. Pick the one you want to tackle first and write it down in a notebook.
4. List what you need to know to give yourself a chance of
• • • • • • •
Search engines i.e. Google Television Business magazines or newspapers Seminars Books, audio or DVDs Industry association Find three experts — meet with each one, discuss your issue and ask for a proposal. The first step in developing an Entrepreneur’s Mindset is to admit that you ‘don’t know what you don’t know’ and ask for help. Once you free yourself up and stop pretending you know, you will be amazed how open your mind becomes and what answers, people and success (and potentially millions of dollars) will come your way. TB
solving it.
5. Start looking for information and record it in the notebook as you go. 6. Start making changes. (There is never a right time — just do it!) Within one week you should be well on the way to finding an answer by spending 30 minutes to an hour each day doing some research in any one of the following sources: • Ask an employee • Use your network. Call your accountant, lawyer or another business owner who has had a similar challenge. Then, ask them if they know someone else you could talk to.
Andrew Vincent was the creator and producer of the Channel 9 television series Your Business Success. Over 80 of the best episodes have been re-edited and workbooks written to create the largest video based ‘Australian’ DIY Business Improvement program. This program is backed up by a FREE business coaching service. There special 10% discount for thinkBIG readers during December and January. Go to: www. yourbusinesssuccess.com.au/thinkbigmagazine.
focus should be is explained by Michael Gerber who wrote a book called The E-Myth. The E-Myth is short for the Entrepreneurial Myth and Gerber writes that most small business owners aren’t really entrepreneurs, they are technicians suffering from an entrepreneurial seizure. The plumber, hairdresser, accountant, butcher, baker and candlestick maker all wake up one morning and decide they are sick of working for the boss. So they quit their job and set up their own business doing the technical work they did as an employee. It is only on the first day in business that they realise the being able to do the technical business work has nothing to do with running the business. Sales, marketing, human resources, management, money, strategy, technology etc. is all learnt on the run. However, this is the road to mediocrity and often failure. At some stage successful entrepreneurs realise that they ‘don’t know, what they don’t know’ and most importantly, they understand that it is OK not to know. Often after losing money, going broke, or poor health, they realise that although they were the best person doing the work, that wasn’t good enough. They needed to develop an Entrepreneurial Mindset and learn how to run the business without doing everything. The first step to doing this was to admit to themselves (and to others) that they ‘don’t know what they don’t know’ but want to learn. They were prepared to ask the ‘dumb question’, employ people better than themselves, delegate to others, attend seminars, watch DVDs, read books, employ business consultants and ultimately leave behind the technical work they know so well and move on to managing and driving the business.
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thinkBIG mindset thinkbig
inner self Who are you? Your true self By Bridget Thompson
One of the most important things I work on with clients is the discovery of our true selves. This is a surprising deviation from the traditional ‘dietitian’ role I originated from. It would be denial however, for me to embark on any other path.
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t never ceases to amaze me just how often we battle against the need to be ourselves while taking on the need to fulfil the roles we believe we should play. Often this lopsided dichotomy becomes a physically manifested expression of ill health and stress. People come to me because they are tired, unhealthy, unfit, getting old, ‘battling’ numerous health afflictions, overweight and not quite resembling the self they remember. They come hoping to be told what to eat, when and how to exercise and be given a ‘plan’ for getting on track. What they experience is quite different. The symptoms of stress, disease and ill-health are mere indications of the deviation from our true selves. When we are born, we are born as pure creative spirits. We have no idea about limitations, possibilities, should, shouldn’t, have to, must and must not. We live from innocence and lose ourselves in the world of the imaginary where we are FIREMEN, SUPERSTARS, TEACHERS, PILOTS and ANYTHING at all we desire to be. Every day is fun and everything we experience is from a point of curiosity. There is little fear, judgement or doubt. We think, or rather, imagine BIG! As we grow older, we are conditioned. We MUST do this, we
MUST wear that, we CANNOT say this, or DO that. We learn that being ourselves is NOT OK, and we must abide by the rules, expectations and orders of all those around us who ‘clearly’ know better than we do. Over time, we lose touch with our DREAMS and often times end up on path that we never intended or wanted. Sometimes we don’t even realise that we have lost ourselves. It seems so normal to do what everyone else is doing and to follow the crowd. Without realising we buy into thinking small. That is until we reach a state of passionless, and an often times despairing, ‘ground-hog-day’ type existence. At this point, I often meet most of my clients. From here, we start a journey; a beautiful journey of self discovery. And yes, the food and lifestyle that enable us to honour our greatness are also contemplated. The connection between body, mind and soul is one that cannot be ignored if we desire to be the most optimally functioning version of ourselves possible. What we feed our body, feeds our mind; similarly, what we feed our mind, feeds our body! See the relationship? It’s intriguing, exciting and magical. Get to know your body, get to know your mind and learn how your SOUL is the bridge.! If we are to THINK BIG, we must realise the source is much greater than we imagine. We must reconnect and we must honour our body. If what we feed our body, feeds our mind and ultimately creates our results, what more could you be tapping into? Also, if your mind is full of turbulence, stress and overwhelm, what impact is that having on your body? If not now, then in the near future? Think about it. TB
Having once been overweight and unfit, Bridget Thompson is now an accredited practicing dietitian with a passion and zest for helping her clients to live happier, healthier and more purposeful lives. www.newleafnutrition.com.au
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think feature thinkBIG
Disciplinethe secret to success By Michael Moore
What is discipline and how can it be used as a tool? Discipline has quite rightly been called the application of responsibility to action in the direction of achievement. Sounds very scholarly but it is also very true. There is a secret to discipline. It has the astounding ability to make one very successful in any endeavour of life.
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iscipline has often come to be regarded as a dirty word by some people. Perhaps the connotations of strict drill Sargent and school masters have coloured what is perhaps the most useful and effective tool available to achieving what you want. Discipline is basically
Do it. Whatever it is you want to do or want to achieve or want to have in life.
Do it. Discipline is simply not stopping, but continuing. When you are tired, or fed up, or hungry, or your feet hurt. Or you still hunger for that cigarette or drink. Or you feel lazy, want a holiday, just feel it’s too much, or just feel like a sickie, or want to spend that 100 dollars shopping instead of save it as you promised yourself, discipline is where:
You still do what you have to do anyway. Discipline is not giving up. Discipline is being responsible for doing something...anyway. If you adopt the attitude that discipline is a tool and not a chore you will discover how useful discipline can be. Speak to any winner, any sports personality who has climbed the ladder and he or she will tell you that discipline is the bridge between his or her goal and the accomplishment of that goal. The top golfers of the world like Jack Nicklaus, Greg Norman, Tiger Woods will hit upwards of 1,000 golf balls a day, practicing day in day out. Even if they do not feel like it or have an ‘off’ day. There they are hitting balls one after another. Rain or shine. Heat or hot, wet or dry. Disipline. How many lengths of the pool do you think an Olympic Gold Medal winner like Michael Phelps swims each day, day in day out? How many slam dunks do you think Michael Jordan did each day in practice to maintain his peak performance? How many hits did Don Bradman take a swing at to become such a legend? It is discipline and persistance come what may, not luck or good fortune that makes the difference between a winner and a no winner.
Discipline can take you to wealth Discipline could be called the application of determination to achieve a known goal despite any and all personal obstacles. If you have determined that you must put away 100 dollars per week towards a propety investment for example, discipline is the tool to ensure that you do it and don’t use the 100 dollars for a night out or to purchase that ‘whoozit’ you have been aching to get. If you don’t put that 100 dollars away this week, that’s 100 dollars you are delayed in reaching your goal. It is easy to say. “Oh that was just one day, I’ll start again tomorrow.” The next week, there is another bill come in. “I’ll just pay that bill now. There is a sale on. One more week won’t hurt. I’ll start this program next week.” It does hurt! You goal will recede further and further away into the distance until it disappears. This is procrastination at its worse and procrastination is the covert enemy of discipline. If you look around, you will see that nature employs discipline. The tree strives and reaches higher and higher towards the sunlight despite the relentless pull of gravity. The tree does not have a sickie or a day off. A weed will push up throug the concrete. The concrete is harder than the weed but the weed has something the concrete does not have. Determination without end. Insects, animals and fish all strive better despite the odds or opposition to achieve better survival for themselves and their offspring. Instinct you might say. Survival perhaps? Well whatever you want to call it, it is still a case of not giving up but persisting until the goal is reached. It is all very nice practicing affirmations such as, ‘I will be wealthy’. It has no value without the goal to aim for, the plan to show you the route, the action of travelling along that route and the discipline to get you there. Besides which, that is just another way of putting it in the future. Tomorrow never arrives as it is always today. It is what you do here and now, today, that decides your future, not what you intend to do tromorrow. It takes more than just saying ‘I’m gonna be rich.’ It takes applying oneself to a known plan of action in a known direction towards a
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specific goal with no deviation from the path. Discipline is bound up with responsibility and integrity rather like a triangle. Taking responsibility for oneself is the application of discipline. Can you take responsibility for your chosen path even if the way becomes difficult? Thomas Macauley’s definition of integrity was, ‘The measure of a man’s real character is what he would do if he would never be found out.’ Worth thinking about that. Can you apply discipline when there is no one around to check on you? That is a true measure of discipline. Tom Hirshfield, the physicist said, “If you hit every time, the target is too near or too long.” Discipline is not giving up but persisting anyway. Any failure you experience along the way is simply part of the journey, not the end of the journey. All successes are built on failure. Failure might be the first step. Success is the last for those with the determination and discipline. Edison tried 1,000 times before he hit success with the incandescent bulb. Ray Bradbury submitted 1,000 stories to publishers before he got one published. J. K Rowling was rejected by no less than 12 publishers before Bloomsbury Publishing took her on with the Harry Potter story. Philip Knight, CEO of NIKE once said. “The only time you have to succeed is the last time you try.” So do not expect to necessarily get it right first time and don’t consider yourself a failure when you don’t. It can take practice and perseverence. That is where the disipline comes in. Discipline can be made a habit. The results of applying discipline can be absolutely staggering. When you achieve your goal and have applied discipline along the way, come what may, imagine how strong and capable you will feel. There is enormous satisfaction to be gained by achieving one’s goals through discipline properly applied. Assuming responsibility for youself by being persistence in reaching your goal despite any obstacles that try to impede you. Maintaining your vision and looking at the goal and not the obstacle. Keeping discipline by doing whatever has to be done even when you don’t want to do it and being true to yourself are all part of a winner’s attitude and a wealthy one too. Practice using discipline. Treat it like a friend. Become excited asbout it! If you miss from time to time, okay, start again.
Persist. You secretly know you can. Take a smaller step if a bigger one is too much. Take lots of small steps. Practice using discipline, it can make you a fortune! There are ten little words that demonstrate what it comes down to: If it is to be it is up to me. Apply those ten little words and discipline and who knows where you can end up? TB
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thinkBIG mindset thinkbig
mind map Time to change negative thinking By Jenetta Haim
Mind imaging is a process developed by Mark Furman, a cognitive neuro-scientist. Mark discovered a scientific process which makes the invisible patterns of our mind visible enabling us to change the negative thinking which sabotages us.
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ind Imaging allows people to create an ‘image’ that represents the structure of their mind. This is known as a ‘neuro print’ and covers all areas of our thoughts, emotions and behaviour. This image can be used to visualise doubling income, losing weight, quitting smoking and achieving these goals in a short span of time. We are all becoming more aware each day of how our thinking shapes our lives. Yet sometimes we just can’t help being in the doldrums. It is this thinking that sabotages the best of us. The Neuro print created in mind imaging works like a feedback system. It’s like looking in the mirror in the morning and putting on the make-up to create the image which we use to face the world. This method allows the mind to form an impression of itself and allows the person to make adjustments in order to quickly achieve their dreams and goals. The process uses dreams and goal setting, emotions, calculations, art and colour to create a mind map and build new neural pathways from the negative state to those dreams and goals. Emotions such as depression can be used to build new pathways to lead to positive feelings such as love. However it doesn’t work on everyone because we are all unique and the Neuro print created is just a road map to guide us. It needs regular monitoring and modification for it to work. The idea is that as we reach our goals we in turn create new ones and keep doing so to enhance our lives.
Using this method, as we create new goals we will find that our old patterns start to emerge with yet another set of negative limitations that tell us those goals are unachievable. This is the way the subconscious mind plays out its sabotage again and again and it means that yet again a new mind map needs to be made. The whole process works on the fact that our thoughts do not necessarily control our behaviour. It is our subconscious that controls behaviour and over-rides any conscious programming we do. This is why despite our best intentions we often break our diets or keep smoking. The subconscious however works faster than the conscious mind. In fact almost 95-99% of our behaviour comes from the subconscious. However, we often don’t know what is held in our subconscious which is why we find it difficult to simply think ourselves into a good mood unless our subconscious wants to go there. Mind imaging is just one of the new tools that can help bring subconscious programming to the surface and we need to work with it in order to make conscious positive changes to our lives in line with our goals and dreams. There are also other ways that you can affect your emotions positively; NLP, energy work such as Reiki or Core Energetics or through hypnotherapy. These methods help you to diffuse your negative patterning in the subconscious mind and replace it with positivity to help you realise your goals and dreams are achievable. So what can you change about your thinking that would make your life better and how will you go about doing so? TB
Jenetta Haim runs ‘Stressfree Management’ and specialises in developing health and lifestyle programs on either a corporate or personal level www.stressfreemanagement.com.au.
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thinkBIG feature
Verne Harnish:
Fast
By Daniel G Taylor
Thinking Why don’t Australian business owners flock to overseas experts when they visit? Could it be the tall poppy syndrome we’re famed for; we simply don’t respect people who put their hand up in class?
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uccessful entrepreneurs – if not willing to be the one to put their hands up, must be the ones to copy the notes of the know-it-alls – leap at the chance to learn from leading thinkers, such as Verne Harnish and the speakers he has lined up for a Summit to be held in Sydney in February. What makes Harnish a brain? He’s the “Growth Guy” for Fortune magazine and a number of other titles, plus author of Mastering the Rockefeller Habits: What You Must Do to Increase the Value of Your Fast-Growth Firm. Fortune Small Business magazine named him one of the Top 10 Minds in Small Business. For 15 years, Harnish chaired the “Birthing of Giants” entrepreneurship leadership program at MIT. He founded the Young Entrepreneurs’ Organisation (now Entrepreneurs’ Organisation), that offers education to young business owners, boasting 7,300 members in 42 countries. He also founded the international Association for Collegiate Entrepreneurs, that helps students plan, finance, and complete their business ideas. Harnish’s current focus is Gazelles, Inc., described on the company website as an outsourced corporate university for mid-size firms that hosts a faculty of well-known business experts including Jim Collins, Geoff Smart, Jack Stack, Neil Rackham, Seth Godin, Pat Lencioni and David Allen and sponsors best practices trips to GE, Southwest Airlines, Microsoft and Dell. “We think it takes a combination of two things for you and your executive team to keep up with the growth of your company and the opportunities in the marketplace,” Harnish says. “First, education. Second, coaching. Coach without the education and you’re not going to be able to move as far and fast. Education without some supporting coaching and it’s doubtful you’ll get the traction and the implementation you’d like.” Even with all the successful things he does, family – wife Julie and their four children, Cameron, Cole, Jade and Quinn – come first. It
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was his family where he was first exposed to business. He grew up going to any business meeting his dad would let him sit in on and the first business he was in was one they started together.
The Rockefeller Habits In his introduction to Mastering the Rockefeller Habits, Verne Harnish quotes Buckminster Fuller, “If you want to teach people a new way of thinking, don’t bother trying to teach them. Instead, give them a tool, the use of which will lead to new ways of thinking.” What are the Rockefeller habits? Harnish defines them as Priorities – having a specific priority for each quarter. Data – collecting the numbers that give you a clear idea you’re on track. Rhythm – how often do you need to meet with whom to build solid, productive relationships. Here are some of Harnish’s tools: One-page strategic plan. This is the page you want to get everyone onto in the expression ‘on the same page’. It’s your business dashboard, showing your long term and short-term vision, metrics and priorities on a single page so you can communicate them to everyone in your organisation. Then everyone can work toward the same goal
Coach without the education and you’re not going to be able to move as far and fast. Education without some supporting coaching and it’s doubtful you’ll get the traction and the implementation you’d like.”
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thinkBIG feature Meetings. Common business sense is to cut meetings to a minimum – and always have an agenda. While Harnish is a giant on agendas, he’s also a giant on the number of meetings. Two meetings are vital. The 5-to-15 minute daily meeting, with everyone in the organisation, looks at what’s up, the daily measures and where people are stuck. A weekly meeting tracks the weekly numbers and uses the genius of the team to work on a big issue. Quarterly theme. Connect your theme to a quantitative goal, a key number you want your business to focus on, then use the theme to imprint onto your team-mates where you’re heading, what’s important and the role each person plays to make the vision happen. Employee feedback. What do you do when your teammates challenges their having with the organisation? Do you even have a system in place to get that feedback and then solve the challenge, seeing it for the opportunity it offers? Brand promise. What is brand promise? It’s what really matters our customers, the reason they keep coming back to you. Identifying your brand promise helps your business narrow in on the key strategy to dominate your market. Use all these tools – and the others in the book – and you’ll be in the iron age while your competition stay stuck in the stone age. TB
Mastering the Rockefeller Habits by Verne Harnish What if you had a toolkit that gave you the right tool for any challenge a small to medium business can face? Pick up a copy of Mastering the Rockefeller Habits and you’ll have one. Harnish has such a breadth and depth of knowledge – some of his ideas will have a familiar tinge – but he turns great ideas into doable actions. For example, most entrepreneurs have heard of the need to identify and align your organisation with a set of values. In the tool Harnish provides, instead of a list of dispassionate values that gets laminated then gathers dust on the wall, you use values to create a culture that supports your business goals. One of the tools I tested was the one-page strategic plan. I used it with two teammates and not a third. Those who had the plan drilled into them created the culture it expressed; the person who only had instruction in how to do their work saw it as just another job. The tools work and if you want to get results, use them.
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thinkBIG business
debtors Retention of title - Bad debts getting you down?
By Darren Brown
Getting paid by customers can be a battle and it is essential that you employ effective tools and tactics to assist in securing payment from debtors.
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roperly drawn credit applications and trading terms are cost effective weapons to make sure you get paid. A hard fought for sale is worthless and even damaging, if you do not get paid or if payment is long delayed. Allowing debtors to be in control of when (or even if) to pay can clearly be very damaging for any business.
What can well drafted trading terms do? Well drafted trading terms can be used to attack a debtor for payment and as a shield to protect you from claims. Effectively drawn trading terms can: • require debtors to pay your accounts on time or risk payment of interest and administration charges; • assist you to become a secured creditor and rank in priority to other creditors; • require the debtor to pay your legal costs of recovery; • require a company’s directors to pay you if the company does not; • allow caveats to be lodged over land owned by a debtor and its directors; • facilitate the appointment of an administrator to the debtor company, ie. when a debtor does not pay, someone else is in charge of the company; • permit the recovery of goods that have not been paid for via retention of title provisions; • require a debtor to raise its claim for defective goods and services within a short period of time after delivery (eg. seven days after delivery and not six months later when it is being chased for the debt); • minimise your exposure to claims for damages and compensation from a debtor; • protect your intellectual property, eg. labels, designs, copyright etc.; • stop debtors from using spurious claims as a means to delay, avoid or reduce payment.
The bad news is that, unless you have a well drafted retention of title clause that has been sufficiently incorporated into your trading terms with that customer, the goods are already the property of the customer (even in administration or receivership) regardless of whether or not they have been paid for.
What to do? It is often (incorrectly) assumed that provided that words to the effect of ‘title in goods does not pass until payment is made’ is set out at the bottom of an invoice, it is possible for the unpaid goods to be ‘reclaimed’ from the customer. This is incorrect. In most instances a clause to that effect will not be sufficient and is of little help in assisting you to retrieve your goods. Consider the following possible scenarios: • What happens when you turn up at the customer’s premises to retrieve your goods and they simply say ‘no’? • What happens if the goods have been partially incorporated into other goods? • How do you identify the goods? • What happens if the customer has marked some goods as sold?
In a recent landmark decision, the High Court set down the guiding principles of what is required for a retention of title clause to be effective. It is important that your trading terms and invoicing comply with the principles set out in that decision. It is also important that you not only have an effective retention of title clause, but that you also take steps to make sure it is ‘incorporated’ into your dealings with the customer. Merely putting a clause on an invoice is often futile – it’s like closing the door after the horse has bolted. Knowing how to have those clauses effectively form part of your dealings with your customers is another vital part of the equation. In most instances, a properly drafted and correctly incorporated retention of title clause will allow you to recover your goods (and in some instances recover payment for goods already sold by the customer) if payment has not been made even if a receiver or administrator has been appointment. TB
Darren Brown is a Senior Associate of Kliger Partners, Lawyers. www.kligers.com.au
Don’t delay Don’t leave it until it is too late. In these uncertain economic times it is important that you stack the deck in favour of you getting paid or recovering your goods. If you believe one customer ‘going bad’ will hurt your business, imagine two, three or more. To illustrate how well drafted trading terms can assist you to get paid, ponder this question – who would you pay in the following example? • Bill: who has sent a letter of demand begging for payment; or • Bob: who has exercised powers under his trading terms by: 1. registering a debenture charge over your company; 2. lodging a caveat over your family home and investment property; 3. placing your company into the hands of an administrator; 4. taking steps to sell your properties? Well drafted trading terms can assist to put you in Bob’s shoes!
Want your goods back? What can you do if you have sold goods to a customer (and you know they are still holding them) but the customer has not paid you? For example, you have been dealing with a customer for several years and have built up a solid working relationship. Over the past few months you have noticed that the customer’s payments on your 30 day credit account are now slipping into 60 and 90 day territory. Due to the long standing relationship, you are prepared to accept this minor hiccup. Then the week after having shipped $10,000 worth of goods to the customer you get the dreaded letter that an administrator has been appointed to the customer. That shipment — combined with the last 90 days of accounts overdue — leaves you with a total exposure in excess of $40,000. Can you get your goods back even if they are still in the customer’s warehouse or store shelves?
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thinkBIG feature
The Money
By Sharon Pearson
Isn’t In The
Widget Old thinking says the money is in the products we sell. But if no one knows you have a widget to sell them, there’s no money in it. So where is the money to be made? It has to be in the marketing of what you sell. Sharon Pearson, founder and CEO of The Coaching Institute and the Small Business Entrepreneurs Group, shares her top seven tips for business success.
T
he financial success came when I learned that the money isn’t made in the talent or the product, it’s making sure ‘the talent’ is getting in front of enough people who can spend money on it. I’ve invested a fortune in my education, both formal training and in the mistakes I’ve made, to learn this lesson. Marketing is not part of your business – it is your business. You either have people inquiring about you and your ‘widget’ or you’re dead in the water. Here are the top seven strategies I’ve learned and applied that have taken our organisation from ‘talented’ to multi-million dollar business in three years. Seven keys to business success: 1. Marketing is everything to a business – especially in the tough times. When the going gets tough, no matter what, you keep making sure the leads are coming in so you have someone to get in front of and sell to. I remember when we didn’t get this, and a good month would have been one hundredth of what we do today. Same market, same opportunities, we were just relying on our talent to do the job! 38 thinkBIG
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2. Be unique, not the best – being the best is a claim that is overused and difficult to substantiate. But being unique speaks for itself. If you can be the ‘only’ you will appear to be a much bigger fish in the pond than those who are also-rans and one-of-many. We used to claim we were the best, but how is this measured? Then we made sure we were unique, with huge points of difference that other coaching schools couldn’t match. Our focus became on marketing skills for coaches. Anyone can claim to be the best coaching training, but few can back up the claim that they’re the only school that will guarantee you’ll work with paying clients or your money back. 3. Don’t try to make the sale straight up – it’s much better to build a relationship first so your prospect can build trust for you and what you do. In the beginning there is low trust and low knowledge of you and what you can do for them. You need to build their trust through educating them for free, before you ask for money to change hands. When we used to go straight for the sale, without educating our prospects, they were flying blind about whether we could do the job. I wonder how anyone managed to join. Now we educate and provide outstanding value before they have to do anything for us. Monopolise Your Marketplace is a website that give free stuff away, and taught me about the ‘educational spectrum’ where you educate in the beginning, and slowly build the right to ask for something in return. 4. Move the free line – this is one of the most powerful strategies we have ever used, and it’s made us, literally, millions. You give away valuable, highly prized information that people would expect to pay for, and you give it willingly. The more you give, the more the Law of Free will kick in and the more trust will be built. I used to find it difficult to justify giving away much stuff, because it cost money. I look back on that now and cringe. We give away thousands of dollars of stuff before anyone has to do anything for us. We run regular meetings on what else we can give away. The best place I learned about this concept was Predictably Irrational by Dan Ariely.
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thinkBIG big feature 5. The dollars are in the list – you need to build a database of potential and actual buyers. No matter how small the purchase, no matter how insignificant the twitch of interest, you must get their details, because as they build confidence in you they will become more inclined to buy. We have people joining our programs years after their first inquiry. Russell Brunson teaches this really well. He gives away free stuff in return for your contact details, and then he builds trust through giving away free stuff. 6. Guarantee your stuff, or don’t offer the stuff – and by guarantee, I mean be prepared to give the money back if the buyer doesn’t get what they wanted. Internet marketers do this brilliantly. They offer a complete money back guarantee even if you don’t like the look of the box. You don’t need to go that far, but you need to come up with a guarantee that will make your hair stand on end. This one was a big one for me to get my head around. Then I realised that what it actually guaranteed was that we would have to provide a phenomenally good program. 7. Give three to ten times more value than you charge – if you’re going to ask for someone’s money, the easiest way to tip them to a yes is to give them so much value for their yes that it seems completely insane to say no. TB Sharon Pearson is founder and CEO of The Coaching Institute and the Small Business Entrepreneurs Group, author of “How to Coach Yourself to Success” and the “Business Blueprint” Program for small business owners. www.thecoachinginstitute.com.au
Seven Keys to Business Success: 1. Marketing is everything to a business – especially in the tough times. 2. Be unique, not the best – being the best is a claim that is overused and difficult to substantiate. But being unique speaks for itself. 3. Don’t try to make the sale straight up – it’s much better to build a relationship first so your prospect can build trust for you and what you do. 4. Move the free line – you give away valuable, highly prized information that people would expect to pay for, and you give it willingly. The more you give, the more the Law of Free will kick in and the more trust will be built. 5. The dollars are in the list – you need to build a database of potential and actual buyers. 6. Guarantee your stuff, or don’t offer it – and by guarantee, I mean give the money back if the buyer doesn’t get what they wanted. 7. Give ten times more value than you charge – if you’re going to ask for someone’s money, the easiest way to tip them to a yes is to give them so much value for their yes that it seems completely insane to say no.You want to make it a ‘no brainer’ offer.
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think feature thinkBIG By Robert Stoneham
Contractual
obligations
&insurance Many contractors will be familiar with the various forms of contract used in today’s business environment. It is important that business owners understand the ramifications of contractual obligations/ conditions with regard to insurance coverage and how insurance coverage may be prejudiced in the event of a claim which includes contractual liability issues.
I
n most of these contracts, the insurance/indemnity clauses will state words to the effect: “ABC Pty Ltd agrees to indemnify XYZ Pty Ltd … ” (XYZ Pty Ltd being a principal in contract.) There are numerous versions of these indemnity/hold harmless/assumed liability clauses contained in contracts; however, the net result is that ABC Pty Ltd has agreed (under contract) to indemnify XYZ Pty Ltd, in some instances, for ‘anything that may happen’ whether ABC is negligent or not. Indemnity is defined as security or protection against loss or injury or a promise by a promisor to keep the promisee harmless against loss as a result of entering into a transaction with a third party. Most liability insurance contracts (public/product liability, broadform liability insurance, professional indemnity, etc) contain exclusion clauses that relate to contractual liability assumed by contracting parties. Insurance companies are hesitant in providing blanket contractual liability cover under liability insurance programs because, more often than not, these indemnity clauses contain provisions that are in excess of what common law would normally require. If you agree to these types of clauses, you could be providing something well above what the law would normally require of you and you have effectively discarded any legal rights that you may have had. It is very important that the insured parties obtain legal advice from their respective counsel with regard to contract conditions prior to the signing of those contracts.
Furthermore, all contracts that you enter into should be referred to your insurance broker or insurer for vetting, again prior to their execution. Insurers will not provide you with any legal opinion or advice; however, depending on the contract and what it actually involves, some insurers may agree to provide the contractual liability cover. Insurers may charge extra premium for this additional risk. Another potential contractual liability issue that you need to be aware of is ‘waiver of subrogation rights’. Insurers rarely grant this; however, we have seen instances where companies have signed contracts containing this clause (plus the indemnity clause) and have not had the contract vetted by their insurance broker. Apart from the fact that this creates breach of contract conditions, it potentially leaves the insured uninsured! Insurers rarely agree to waiver their rights of subrogation against potential negligent third parties. If you have agreed to these onerous conditions, you have essentially prejudiced your insurer’s rights of recovery. Check your policy wording in the exclusions section for contractual liability. With WorkCover launching recovering actions against negligent employers, you have to wonder who is going to pay the legal bill if you are being sued. Please consider the following scenario: • You have agreed to indemnify a third party. • The third party causes your employee to be hurt. • WorkCover commences legal action to recover its costs
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against ‘negligent parties’. In this instance, the principal that you have agreed to indemnify. • As you have agreed to indemnify and waiver any rights of recovery (termed ‘subrogation’) against the negligent third party (remember, you weren’t negligent), you may only be indemnified (bearing in mind you have prejudiced your insurer’s rights of recovery • you might have a fight on your hands with regard to getting indemnity from any insurer to defend the first action) for the part that you were legally liable for. If you aren’t legally liable, then your insurer is not obliged to pay. You pay! Liability insurance programs require a ‘trigger’ that leads to legal liability on the insured’s part causing personal injury or property damage. If you aren’t legally liable, then your insurers may not have to indemnify you against substantial legal costs, damages awards or court-imposed penalties. You need to obtain legal advice with all contractual matters, together with referring contract insurance and indemnity clauses to your insurance providers. If you are not being briefed on
these areas, then you have to consider the effectiveness of your risk management program. This article was kindly provided by IC Frith and Associates. IC Frith and Associates is an Australian owned and operated provider of financial services. www.icfrith.com.au TB
Common contracts encountered by business will include (but not be limited to):
• construction contracts • tenancy/lease agreements • fire-fighting appliance servicing/maintenance contracts • computer maintenance agreements • supply contracts • subcontractor agreements.
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The FCA and You – Now that you are a Franchisee... PART 2
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By Damian Kay
In the first article of this two part series, I wrote about the pitfalls of relying on the Franchisor being a member of the FCA (Franchise Council of Australia) and some suggestions on what you need to do to perform your own due diligence. In this follow up article I will explore what you can use the FCA for.
O
ne of the biggest challenges when you go out on your own is that you do not get the regular training/coaching you may have received when you worked for an organisation. Training yourself can be expensive and takes you out of your business at a time when you are desperately needed. Continued development and training should come from a number of places if you are serious about long term success. These sources may include: • Your Franchisor (if you did your proper due diligence before you invested in the system, this would have been a consideration) • The FCA • State Governments e.g. Department of State and RegionalDevelopment in NSW • AIM (Australian Institute of Management) • Books • Seminars • Networking The FCA in the State Chapters is very active in providing seminars, breakfast sessions and round tables that promote learning and development. Many of these are held at times that do not take you out of your business for long periods of time. The sessions are fantastic for meeting other franchisees to discuss issues and experiences. I would also recommend taking your key staff members along as it gives them a good overview of the industry. The FCA provides further education as part of the Franchise Academy and from all reports this is an excellent course. We have found that after the first 6-12 months of business growth, the FCA becomes less relevant to the franchisee. There is very little that they can directly continue to add to your business. However, let me give you a few specific suggested areas of business growth that we highly recommend.
First we recommend that a franchisee obtain sales training because learning one new idea can help your business to grow more rapidly and keep you sharp when with potential clients. The second is finding ways to enhance your client care or customer service. If you get a lot of customers and don’t have a way to keep them, you will find your business will be less profitable or sustainable because it costs more to get a new customer than to keep the ones you have. We hold regular ‘roadshows’ to make sure we are sharing what we have learned with our franchisees, so they can apply it to their businesses. The third area of specific knowledge is financial training. You need to develop ways to collect the money owed to you as a business, but also make sure your business is growing profitably as well. We outsource our financial training and use the expertise of Westpac bank. The training they provide to our franchisees gives us peace of mind that they have the ability to measure their success using tools that are proven in the financial arena. Lastly, we always recommend and offer personal development or coaching to our franchisees. How important is this? You can’t always expect things to go perfectly, so you need to have tools that keep your attitude strong, persistent and driven. From my experience building Telcoinabox, coaching was a powerful key to our success. I counted on my favourite book How to Win Friends and Influence People by Dale Carnegie. Personal development has to be just that, whatever works for you to grow. If you make sure that you use all the FCA tools and resources as (well as your franchisor’s resources), you will possess some excellent skills to start and grow your franchise business. Once you have used these, make sure you begin talking to other small business owners to find out what they are use to helps them progress. TB
Damian Kay is the founder and managing director of telcoinabox. www.telcoinabox.com/thinkbig
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think feature thinkBIG
Brothers
in arms In spite of the doubters, Bill and John Fotiadis have built their Souvlaki Hut franchise into a 28 store, nationwide family restaurant phenomenon. In the process they learnt that family is thicker than garlic sauce. Jonathan Jackson reports.
S
ibling rivalry or indifference is often a difficult problem to overcome. When two brothers – years apart in age — have nothing in common, the only thing they share is the family bond. John and Bill Fotiadis are two brothers who up until 2004 spent more time apart than together. The pair had taken diverse career paths. John had leveraged himself as a corporate businessman, Bill the entrepreneur who had kick-started his career at age 14 running underage club nights pulling in $7,000 per night. The one thing they did share was a work ethic forged by their father which brought them together in business and made them closer in life. “I learnt my biggest life lessons from our parents,” John says. “They moved to Australia from Greece and worked in a milk bar for their relatives. Our father took over the milk bar and ended up extending the business to two milk bars. It was extremely hard work for him and from a young age we were taught firsthand how tough running a business can be.” Bill concurs. “I learnt early on that it doesn’t matter how hard you fall, it’s how quickly you can get back up.” While John learnt his business skills in the corporate world, first with the State Bank of Victoria which merged with the Commonwealth Bank in 1991, Bill set about working for himself, establishing and growing two businesses supplying product to the Australian fast food industry. It was while operating and owning a business called Magic Taste that Bill drew on his Greek heritage to develop a souvlaki based product for a multi-national fast food chain. In seven days they sold six weeks worth of product. Meanwhile John was tiring of the corporate life and Bill felt the two should pool their skills. John would look at the business from a process point of view and Bill would drive the ideas. The success of Bill’s single product line, brought John across the line and they formed a business partnership. “This is my first time in business with family, in the past I always worked with business acquaintances and I always took risks,” Bill says. “Being in a partnership with John has been more structured and
planned – which has meant we complement each other and work really well together. We know our common goal and we both bring our own perspective.” The process perspective is something John swears by. “Everything revolves around process. The key to success however is to make the process simple; the simpler the process the more likely it will be followed, the more likely it will be done correctly and the more likely you will have achieved your desired outcome. Souvlakihut’s processes are built around these principles.” Yet the principles were tested early on as the brothers launched their first store in the still little known outskirt Melbourne suburb of Hillside. Hillside is a housing estate the brothers felt they could utilise to their advantage by keeping the business small and insulated; it was a chance to fine tune the processes. “Hillside was a new estate and there was a group of shops, but every retailer that had been there before had failed,” Bill says. “We spent a lot of money marketing to the local area and refining all our processes and it paid off for us. The store was booming in the local area and we knew we had the right concept to run with.” Bill’s risk taking philosophy had paid off: “I think a big part of being successful is knowing when to take a chance.” However it wasn’t all smooth sailing. One supplier walked off location claiming the concept wouldn’t work in the area (that supplier’s disloyalty meant he hasn’t stepped foot in the chain since). Friends and family were also doubtful and to top things off certain products didn’t work. It took some extensive trialing to ensure the menu and portion sizes were just right. “Bill has the uncanny ability to create something out of nothing,” John says. “He is creative and can visualise things before they develop. He is also a great people person and builds relationships. It has been these relationships with our suppliers that have assisted in our growth so far. He also has great negotiating skills which are critical when you are trying to get the best deals for your franchisees.”
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With the processes in check it was time to expand; they opened their second restaurant in Reservoir in November 2005. From the very beginning they recognised the franchise model as something worth investing in. Bill felt there was a gap in the hospitality industry for casual dining restaurants specialising in Greek food. “We had a vision to bring Greek/Mediterranean food to people at an affordable price. We wanted to offer freshly cooked Greek food in a casual dining environment. I think this has been the key to our success.” Family is big theme in the way the Fotiadis brothers run their business. Not only has their own relationship grown stronger, they have nurtured their suppliers and franchisees in a familial way. They have also taken on a mentor. Bill and John’s third franchise went to a 22-year-old who worked in the milk bar behind their first store. Getting to know Michael Jalloul’s family, the brothers were inspired by Michael’s enthusiasm and potential and have worked closely with him as mentors to build his knowledge and business management skills. Now at the age of 24 Michael operates two successful franchise stores in Melbourne. “Mentoring is a two-way relationship, which involves a more experienced person helping a less experienced person to achieve their goals,” Bill says. “By sharing my knowledge, skills and experience of life to help a younger person develop their ideas and positive attributes, it’s a win-win situation. I am getting full satisfaction and fulfillment for the contribution I make to this person but at the same time I am increasing my own confidence knowing that Michael is gaining from this relationship.” And that’s what success comes down to: relationships. Coming together the brothers have developed a bond that previously didn’t exist. Most importantly they have learnt from each other and grown. John feels that it is his decision making process that has improved. “In the corporate world you are guided by rules, procedures and processes when making critical decisions. In your own business you are making decisions every day and a bad decision can prove quite
costly. I’ve learned to properly evaluate the whole situation before making a decision.” For Bill the growth has come from team work. At first with his brother and later through his franchisees. “I swear by Ray Krok’s (the founder of McDonald’s) motto. None of us is as good as all of us. They were the philosophical words of a fast food pioneer. In our offices this is what we swear by. We need to stick together as a team and when more minds think together and all strive for the same success, we can’t go wrong.” For many years Bill and John were on different pages; at different stages in their lives and living by different ideals. Their success proves that when you learn to work effectively with the people closest to you, you can achieve anything. TB
Five personal development tips John:
1. Have a vision and stick to it. 2. If you fail to prepare be prepared to fail. 3. Never make promises you can’t keep. 4. Integrity – without it there is nothing. 5. Surround yourself with good quality people.
Bill: 1. Set your goals high. 2. Never give up. 3. Ask a lot of questions. If you don’t you will never know the answers you are seeking. 4. Follow your dreams and don’t ever let anyone tell you otherwise. 5. Pull up your sleeves and start sweating for the next 5-10 years.
Three inspiring books Richard Branson (Losing my virginity) McDonald’s story (Behind the Arches) Paul Facella (Everything I know about business, I learned at McDonald’s)
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think feature thinkBIG By Alan Chapman
How to grow your company
fast!
“I started TLC IT because I noticed that the SMB market was not being well serviced.”
What does it take to become one of the fastest growing companies in the country, Alan Chapman an Entrepreneur Organisation Melbourne Member and founder of TLC IT Group explains to thinkBIG.
I
n July 2001 at age 33, Alan Chapman founded TLC IT after working as an IT systems engineer with the Department of Defence. “In the late nineties there was a shortage of IT engineers and it was easy to get started in a new industry,” Alan says. “I started TLC IT because I noticed that the SMB market was not being well serviced.” As the company grew so did the challenges and Alan began to recognise that there were three stages he needed to adhere to experience the type of growth that would see his company enter the BRW fastest Growing Companies list. Stage 1 was at about six or seven team members. • With six or seven you can still keep control and be hands-on, but it takes a lot of time. It’s very difficult to grow a business if you’re very busy running it. It’s at this stage when your systems start to get stretched and you need to upgrade your processes, procedures and internal documentation. Many companies reach this size and stall as the next stage gets scary,” Alan says. Stage 2 is at about 20 team members. • At this size the business hits another wall, the words corporate governance start appearing and growth strategies start to change. You start bringing administration team members and financial people in and costs go up. At this stage profit can suffer and some sacrifice has to be made for continued growth.” Stage 3 hits in at about 40 team members. • Now you’re starting to get serious. At this stage you need an executive team and your job as a business owner is completely different. You must run a team of highly intelligent, strong willed people and keep them focused. Clear vision, purpose and values become very important. Your company will now require new systems, both operational and financial, to keep it moving. Your corporate governance and
risk management policies should be solid and ingrained by now or you will have problems in continuing to grow.”
Biggest Issue According to Alan, one of the biggest issues with fast growth is cash flow. Tight control of cash, backed up by a good relationship with the bank and a smart CFO is critical. • Not all business owners want fast growth, as anything that moves fast is more likely to crash. If your company starts to get the speed wobbles you must slow down and fix the problems, before getting back in the fast lane.”
Fast growth in the financial crisis The financial crisis had a significant impact on Alan’s business, with several clients in the financial industry going under resulting in loss of revenue and bad debts. Due to this downturn many of TLC IT’s projects have been shelved. Yet the IT solutions offered have meant that the overall performance of the company has not been too badly affected. • We have gained a significant number of new clients who realised they were spending too much money on IT with their current suppliers and started looking around, whereas if there was no pressure to save money they would just keep paying too much. The danger to companies like us is not the economic climate but the fast change in technology. Fast change is a double edged sword as change creates opportunity, as long as you’re not standing still.”
TLC IT Awards • BRW Fast 100 companies 2008 and 2009* • BRW Great companies to work for 2008/2009 • CRN magazine fast 50 IT companies 2009 • MSPMentor Best 100 IT Managed Service Providers in the World 2009/2009 For more information about the Entrepreneurs’ Organisation, visit www.eonetwork.org. TB
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think feature thinkBIG Justin Beeton is a successful entrepreneur and investor, a sought after public speaker, author, and climate change campaigner. He speaks to thinkBIG about wealth management and becoming a millionaire by age 24.
H
aving bought his first share at the age of 14, Justin Beeton has gone on to create his entire wealth from the share market. This initial million dollars allowed Justin to follow his dreams and establish his own stock broking firm in 2004. In less than five years he has grown his net worth from being a millionaire to multimillionaire. Now as a professional investment manager, Justin manages approximately $430 million in assets. Justin’s stock broking company, JB Global was recently ranked in the 2009 BRW fastest growing companies in Australia and was ranked as the number one fastest growing finance and investment firm in the country for the second year running. Think Big: What do you believe is the key difference between those who become wealthy and those that don’t? Justin Beeton: The wealthy have an ability to recognise an opportunity and more importantly the ability to seize the moment, take action and do something with the opportunity. TB: What vehicles have you used to build your wealth and how did you use them? JB: Making money is like playing sport and investing is exactly the same. To create wealth you don’t just need to make money, you also need to learn how to keep it. When it comes to the share market creating wealth has more to do with minimising losses. As a share market investor whether you are a novice or professional you will invest in a company that falls in value. To be successful you just need to have a good defence strategy and minimise the loss when this occurs. When I stopped focusing on quick profits and focused on minimising the loss, I made a lot more money and became wealthy. My secret defence formula is very simple. In fact all of Australia has been using this formula to reduce risk in many areas of their life. You just need to insure your share investments whether that is in your own name or within super.
Justin with brother and business partner Scott.
“The business school rewards difficult complex behaviour more than simple behaviour, but simple behaviour is more effective” – Warren Buffett My stock market formula has protected the majority of my capital and my clients throughout 2008 and early 2009 when global share markets crashed over 50% as a result of the Global Financial Crisis. I successfully avoided all the pain associated with losing money because I held insurance. When almost all other stock brokers, fund managers, financial planners and share market investors were losing sleep – and probably hair because of losing money – I and my clients had peace of mind knowing their share investments and superannuation was completely protected. TB: What do you think holds people back from achieving their goals or becoming successful and making millions themselves? JB: Most individuals do not have the required patience or discipline to accumulate wealth. When it comes to the share market the majority overestimate what can be achieved in the short term and underestimate what can be achieved over the long term. Most chase the quick buck and suffer from the unfortunate outcome of losing their money. They then chase the next quick buck scheme in the hope of a different outcome which only ends in more financial pain. The definition of insanity is doing the same thing expecting a different outcome.
“Opportunity is missed by most people because it is dressed in overalls and looks like work.” – Thomas Edison Warren Buffett explains the rules to investing and creating unlimited wealth as:- Rule No. 1 “Never lose money” Rule No. 2 “Never forget Rule No. 1” Investing is that simple.
Walking the
Beeton track
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day trade Make your day trading smart trading!
“I believe a great investment manager can deliver more pleasure and prevent more suffering than any Doctor can.” TB: You have been a champion for investor rights by being the first company in Australia to eliminate trailing commissions to financial planners, why did you make this move and how do you see the market moving forward? JB: There is a huge conflict of interest that exists when financial planners and fund managers are remunerated irrespective of the value they create for the end investor. In 2008 the average superannuation fund fell approximately 30% as a result of the GFC, yet financial planners and fund managers still made their healthy commission. This situation needs to change. I believe the only way to avoid such conflicts of interest is to replace trailing commission with performance fees. If the financial planner or fund manager doesn’t make you money then they should be rewarded with nothing. If they are only paid when they perform then you should see significantly higher returns moving forward. TB: Your company is ranked as one of the fastest growing investment services firm in Australia. Why? JB: I believe all investors are the same; we want to make as much money as possible with very little risk. Usually such an investment does not exist but at JB Global we have invented one. By offering investments which offer all the upside potential of the share market we can make high capital gains, but due to the capital protection feature we take on very low risk. We prove modern investment theory wrong. In 2008 when the market crashed over 55%, the majority of JB Global clients’ investments were completely protected. All of our clients are now well positioned to profit from the upside in the share market as the global economic conditions improve. TB: What are your predictions for 2010 and beyond? JB: History has shown that the years following the biggest market crashes have provided the highest returns and 2009 has confirmed this observation. In the next three years I expect the Australian Share Market to go back to the highs reached in 2007. This will require the ASX200 to rally to approximately 7,000 points or approximately 55% from current levels. TB: What are your four top tips for others to reach a greater level of success? JB: Tip 1 –surround yourself with a team of experts Business and investing are team sports. The average investor or
small business person loses financially because they do not have a team. Instead of a team, they act as individuals who are trampled by very smart teams. When it comes to creating wealth it is even more important to seek professional advice. Tip 2 – Don’t be an ostrich and stick your head in the sand Stop putting your head in the sand and just make it happen. Stop deferring your business idea, stop putting off investing, stop telling yourself the story that you can’t become wealthy and go out there and just make it happen. When it comes to the share market opportunities to become extremely wealthy are presented every day, every hour, every minute. If you do not have a business idea, if you do not know what your passion is, or are fearful about investing in the share market then you need to invest in further education. Tip 3 – Be the tortoise When it comes to investing the tortoise approach always wins. Slow and steady wins the race. Just start early, keep plodding and don’t lose focus on what really matters. That is your longterm goal. Tip 4 – Invest in the share market When investing, historically the share market has provided the highest return across all other asset classes. As it has provided the highest return then why not put the majority of your wealth in the share market. By investing the majority of your money in this asset class you have the capacity to make extraordinary gains. “If you believe the share price will increase in value, then why not have a large investment in that company.” – Warren Buffett Just make sure you insure your share market investments just in case the market falls like it did in 2008. Remember investment success has nothing to do with the money you make when you are right but minimising the loss when you are wrong. Justin Beeton has offered a FREE copy of his latest book The JB Way to every reader looking to improve their finances, valued at $29.95 Just log onto www.jbglobal.com.au/thejbway to register for your book. TB
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As Christine Stavropoulos discovers Lachlan Elsworth is a passionate day trader and international advocate of the opportunity day trading offers even the smallest of investors, he talks about what it takes to become a day trader.
“I
’m a passionate convert to the freedom of day trading,” says Lachlan. “Day trading in a + $40 Billion USD daily market used to be reserved for the big boys of the industry. Brilliant innovation and even smarter technology is now opening up this daily opportunity to new traders and seasoned traders alike. Everyday people are now being offered a brilliant opportunity and this is where the day trading journey begins.” Christine Stravopoulos: Before considering day trading as a hobby or as a home based business opportunity, what should new traders consider? Lachlan Elsworth: Trading the market on a daily basis is as much a function of realistic expectations, as it is a function of discipline, patience, strategy and most importantly, education. New and seasoned traders alike, appear to be flocking to Day Trading in droves. Why? Traders are demanding more flexibility in their trading; they want transparency of performance and a better trading education. Traders want to take advantage of the current unprecedented economic conditions and they want to take advantage now. Potential investors and traders worldwide understand that the world’s financial markets offer a huge opportunity, but they just do not know how to take advantage of this opportunity. Investors generally are less complacent and more pro-active, seeking information and new strategies. All that said, before a trader joins the herd, there are a number of key home truths about day trading that must be considered. CS: What is a realistic expectation and what should new traders look for to give them every possible advantage in the market? LE: For good traders, a realistic daily performance expectation is one of the foundations of a great strategy. Set your goal at up to 5% return on your traded position and then find a strategy to suit. Sounds ambitious for the unanointed, but these opportunities are passing by every day.
As an example, the S&P500 can return 5% on your invested position every time the Index moves a point in your favour. On the big days, the S&P500 can move up to 60 points in the trading day, bouncing up and down as the weighted average value of the top 500 shares in the US change their value. The S&P500 Index is just one of the Index day trading opportunities passing by each day that is actually tradable almost 24 hrs per day.
A realistic daily goal of 5% return may be your first step to a sound strategy! CS: What to look for - Live trading results in live trading rooms? LE: Live daily trading results are the true acid test of any day trading strategy. When you choose an educator, ensure that they publish their results every day, and that ultimately these results are traded live in front of you in an online trading room.
November 2009 Daily Results (pips) Date
Asia
London
Combined
Nov 2 - 3
200
150
350
Nov 3 - 4
-100
0
-100
Nov 4 - 5
100
137
237
In my experience, live trading rooms are a great tool to help new traders understand a trading strategy in real time, live in the market as it happens.
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think wealth thinkBIG Live results and live trading rooms are a powerful educational tool that you may be able to use to your advantage. Use a successful strategy, in a successful room, as the grounding for your trading education. My opinion – having your buy and sell signals marked for you live is a distinct advantage when you are learning to trade. A word of caution – watch out for trading rooms that record profitable trades while their trading rooms are closed! Also watch out for trading rooms that do not mark their losing trades…… CS: What have you learnt about Day Trading since you started trading and educating? LE: That is a great question. Five absolute must considers…. 1. Day trading is not for everyone, so seek advice from a licensed financial advisor to determine if Day Trading suits your financial goals. 2. Trade small positions when you start, say $1000.00 USD only, and limit your actual risk to only $100.00 USD a trade. 3. Keep trading cheap – EMINI Futures traders, utilising a good broker relationship, pay only $2.50 USD entry and $2.50 USD exit per trade. This is possible as EMINI Traders can choose to trade without the use of market makers, unlike most Option, CFD and share traders. 4. Target a company that has been educating for over ten years and trades multiple markets in multiple trading rooms and time zones. Having the choice of FOREX and EMINI Futures
trading gives you options to select the market and strategy that you most enjoy trading. 5. Ensure that you can trade in both directions. Boom or bust, you must be able to use your strategy to take advantage of both! TB
SELF INVESTMENT THE GREATEST INVESTMENT YOU’LL EVER MAKE By Chris Howard
Warren Buffett was once asked, “What’s the first thing someone ought to do in order to become wealthy?” Buffett answered, “Invest in yourself. That’s number one.”
T
Lachlan Elsworth is an international speaker, international day trading coach, and Managing Director of Traders International Australia and New Zealand.
Trading the market on a daily basis is as much a function of realistic expectations, as it is a function of discipline, patience, strategy and most importantly, education.
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ime and time again, hugely successful people are those who have made personal development their first priority. That means education, but in the broadest sense of the word. It doesn’t necessarily mean sitting in a classroom. In fact, in the 2008 Forbes list of billionaires, 73 of them had not completed traditional schooling. Li Ka-Shing, Hong Kong’s richest person (net worth over $26 billion) dropped out of school at age 12, and began selling plastic flowers. There are really only three things you can do with your time. You can waste it. You can sell it. Or (by far the best choice) you can invest your time. That means you will never take a job just for the money. Work because you have a dream and because you’re committed to your dream. Or work because it adds to your skills. One way or another, your employment should be an investment in yourself. Most successful entrepreneurs don’t come from inherited wealth. Most don’t come from poverty either. They usually came from middle-class families and build on the work of previous generations. All of them, however, deeply believe in developing themselves to the greatest possible extent. By seeking out mentors, guides, and sources of inspiration from the marketplace. How big an investment are you willing to make toward your personal success? Would you be willing to invest 10,000 hours in yourself? In his book titled Outliers, Malcolm Gladwell writes, “Ten thousand hours is the magic number of greatness.” Gladwell refers to a study performed in the 1990s by psychologist K. Anders Ericsson and two of his colleagues at Berlin’s Academy of Music. They gathered the school’s violinists and divided them into three groups: 1. Those with amateur talent. 2. Those considered to be merely good. 3. Those with expert abilities. Among these three groups, the difference proved to be the amount of time spent in solitary practice in the course of their skill development. The amateur group totalled around 2,000 hours of practice by the age of 20. Group two, the good violinists, averaged around 5,000 hours by the age of 20. Group three, the group with the ability to be concert violinists, totalled around 10,000 hours by age 20. Along the same lines, neurologist Daniel Levitin states, “In study after study — of composers, basketball players, fiction writers, ice skaters, concert pianists, and chess players — this number comes
up again and again. Of course, this doesn’t address why some people get more out of their practice sessions than others do. But no one has yet found a case in which true world-class expertise was accomplished in less time. It seems that it takes the brain this long to assimilate all that it needs to know to achieve true mastery.” But 10,000 hours is an enormous amount of time. In most cases it would take about 10 years to accomplish. You may not want to become a concert pianist, basketball player, or a fiction writer—so how does this apply to your entrepreneurial dreams? Consider this: To be able to play a violin—not necessarily well, but to even get a sound out of it—you must know several things: for example, how to hold the violin, how to position your hands, and what amount of force you’ll need to make a sound. Each element, regardless of how small, needs to be learned through spending time practicing before you can play well. Now relate this to all the smaller but still important elements that make up your entrepreneurial dream. No matter what your dream is, time would be definitely well spent attending classes or seminars or in an apprenticeship in which you can model successful people, Every hour will lead you closer to the 10,000 hours it takes to have the expertise in your field that would allow you to live your entrepreneurial dreams to the full. For example, even after earning $87 million in one year and ranking fourth on Forbes magazine’s list of 100 celebrity top income earners, Beyonce Knowles still spends tireless hours practicing. She believes in “repetition, repetition, repetition.” While on tour, after every performance she spends two hours reviewing the tapes from the show, even when she’s performed it 100 times, in an effort to constantly improve herself and her performance. She says, “I’m never satisfied.” Stop looking at your watch. Stop looking at the calendar. Start making an open-ended investment in yourself in whatever way your heart tells you is best. As Warren Buffett puts it, “That’s number one!” TB
Chris Howard is a world renowned wealth and lifestyle strategist and author of the new book Instant Wealth – Wake Up Rich! from which this article is derived. To purchase the book now please go to: www.instantwealthbestseller.com
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thinkBIG wealth
thinkbig
diversification Multiple streams of wealth By Jamie McIntyre
What if I wanted to actually become wealthy in a hurry? How would I do it? No doubt, this is a common thought many people have at some time or other.
W
ouldn’t it be nice if it was possible to create significant wealth in a short time frame? Perhaps, it’s creating wealth in only a matter of a few short years, or even less. If it is possible, then how can you get started straight away? Firstly, you need to use the right strategy or more importantly a combination of strategies. I’m not advocating ‘get rich quick’ schemes, but neither am I advocating taking longer than necessary to create the wealth and lifestyle you may desire. My millionaire mentor said to me many years ago, it’s all about synergy. He went on to explain that if I wanted to become a selfmade millionaire in my 20s and was in a hurry, that yes, it was possible as long as I was prepared to take massive action; intelligent action. I would also need to become a fast learner and apply highly effective strategies in certain combination and make no excuses, or allow distractions from my goal. He shared with me the three key areas in which to create wealth: 1. Career (either a job or business). 2. Investing in the property market to gain leverage and over time accumulate riches. 3. Investing in the share market. He said the key is to understand synergy. He explained that using just one of the above vehicles has created wealth for many Australians, especially in real estate, but if you wish to do it in a hurry, combining numerous strategies at once can lead to an acceleration effect. For example, he asked what does one plus one equal? Most people will say two, yet this is not the case. One plus one can equal well more than two, due to the exponential returns of combining strategies. He went on to explain that by just investing in real estate to buy and hold over your lifetime is a powerful way to become wealthy. But it takes time. He explained that by combining property investment with share investment you can accelerate your results faster. For example, he explained that in the beginning, property when negatively geared provides little if any cash flow. This means until rents increase and debt decreases you aren’t going to get rich from cash flow.
He said that most people invest in shares for capital growth and that’s why most people don’t create the wealth from shares they’d like to. He said why would I invest in shares for capital growth, when in most cases property has proven a far better return for capital growth? For example, even 6% pa capital growth on property, but leveraged at 90% of the loan is equivalent to 60% pa return on outlay, versus 13% pa in average growth of shares. With shares you simply don’t do 90% lends due to its higher risk. But rather than dismiss shares altogether, he mentioned what property can’t give me in the short term i.e. cash flow is exactly what shares can make if you learn how to rent shares or sell insurance. Actually, he called it another name at the time, but I coined the terms ‘renting Shares’ and ‘selling Insurance’ some years later, to better explain it to others. The point being, by combining real estate for capital growth and shares for monthly cash flow, one could have the same lifestyle results from property within five years that would normally take at least 15 years waiting for rents to significantly exceed monthly interest bills. But he didn’t stop there. He said that the most common mistake occurs because people see investing as the fastest way to get out of a job they often don’t like. They often stop working too soon, slowing their speed to true wealth and lifestyle. He taught me to focus on building my income up as fast as I could and developing multiple income streams. The additional income can boost one’s property and share portfolios, accelerating one’s wealth further. He said it also truly diversifies one’s wealth and makes one recession proof; if the share market is down, often the property market is up, or one’s business and career incomes may be doing well. So to become wealthy faster, my millionaire mentor suggested to consider synergy and to become financially educated in multiple areas of investments, not just one. TB
Jamie McIntyre is founder of 21st Century Group of Companies. www.21stcenturyacademy.com
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thinkBIG wealth thinkbig
youth and success
rules
Starting smart makes sense
Learning from the young rich – Part 1
By Aussie Rob
By Jack Delosa
G’day Folks, Aussie Rob here… This month’s article is going to be a bit different from others that I’ve written, as it’s not stock/option strategy specific, it’s more ‘life specific’. (Life specific? Gee, I hope he’s not going to get all philosophical on us now.) By life specific I mean looking at generalised rules others have lived by that have made a difference in their lives.
N
o doubt your inbox is similar to mine. Spam, spam and more spam… some ham and eggs and then at last, some real emails buried among the trash. I was sifting through the trash the other day and found a gem. A friend of mine sent me some snippets of J. Paul Getty’s Wealth Secrets. I thought, “If they’re good enough for ole J.P. then they’re good enough for Aussie Rob.” I wish I knew the author of the ‘snippet’, but unfortunately he/she’s unknown, but still, not wanting to be busted for plagiarism, I’ve added a few Aussie Rob twists. Here we go, are you ready to learn?
J. Paul Getty’s Wealth Secrets The late J. Paul Getty’s rules for accumulating wealth were simple and straight to the point. In fact, they were so simple most who read them either fobbed them off as being too basic or believed they knew and used them most of their lives... but these people are probably not rich. So far this sounds like most traders who know all the basics but don’t apply them. We all need reality checks every now and then, don’t we, so we go ‘back to basics’ to either sharpen our skills or find what we’re doing wrong. While these guidelines may lack romance or obvious direction, be assured they are the real deal. Apply them as soon and as often as you can, and apply them with intelligence and creativity. In other words, just plain old do it! Rule No. 1: To acquire wealth today, you must be in your own business. We’re doing ok so far; trading is a business isn’t it? Hang on a minute… here’s where a lot of traders go wrong from the beginning. They don’t treat their trading like a business. Reality check No. 1: Treat your trading like a business. You may think the corporate executive with a $100,000 salary is better off than a small business owner, but the executive will be pushing the proverbial uphill to double his income and, of course, taxes will eat up most of any increase. The simplest blooming onion vendor has unlimited opportunity to expand his business
and his income, and even salesmen, who in most cases are able to write their own pay cheque, can control their sale increases themselves. Yes they can, you know the sales rules; the one who makes the most calls, gets the most appointments, does the most presentations and ends up making the most sales. Isn’t everything in life just a numbers game? Do the numbers and the rest will take care of itself. (Again, easily fobbed off as being too basic, blah blah blah…) Rule No. 2: You must have a working knowledge of the business when you start. Hmmm, does that ring a bell? “Yeah, I’d love to attend your course, but I want to make some money first and then I’ll invest in your training course.” Sounds funny, doesn’t it, like putting the cart before the horse, but so many people think that way. Reality check No. 2: Get educated! If you don’t know what you’re doing when you start, your mistakes will be costly and often unnecessary. (By putting your money into education first, you’ll have knowledge for life. If you don’t and you put it immediately into trading, the market will probably take it from you and then where will you be? You’ll end up ‘paying’ one way or another. These people, more than probably won’t be rich!) Start smart and stay that way by continuing to increase your knowledge as you go. Now there’s a lot more I want to share with you, I just can’t get through it all right now so look out for my note in the next issue. Until next month check out www.AussieRob.biz for more great trading information. TB Aussie Rob has just released a brand new Covered Call training DVD called Aussie Rob’s Share Renting DVD that teaches step-by-step how to write Covered Calls.
www.lifestyletrader.com.au/products
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The more I have seen in business, the more I have learnt the importance of learning from people who have the results you are looking for. These days many people are willing to give advice, the question is what advice do you take on?
G
iven that the average wealth of the people listed in the BRW Young Rich List is $65.5 million (every year BRW magazine publishes The Young Rich List. The list includes the 100 wealthiest people in Australia under 40), I think we can trust that these people, at least for the most part, know how to make money. Everyone in the list is self-made and has therefore not inherited any of their wealth. James Packer has never been featured in the Young Rich List.
Lessons: 1. Think BIG, start small. Before you achieve that first $1 million, you have to get your first dollar. Phillip Di Bella started a coffee business in 2002, selling coffee to cafés. He would roast his own coffee in a machine that he rented and would then pack it and deliver it himself, doing the books for the business on his girlfriend’s computer. Sometimes people can have a romantic idea of what it is to be an entrepreneur, usually these ideals are shattered rather quickly when they realise that it’s not all glamour in the beginning. Having said that, it can pay off. Phillip Di Bella is now worth $47 million and is still dedicated to delivering a quality product to his loyal customers. “My promise to them, and it’s a very simple principle I’ve kept, is that I’ll do for my customers what others are not prepared to.” 2. Never too young. Trent Davis started his company NetBox when he was 22. This was his third business, after his first two businesses had failed. Learning from the first two businesses, Davis went into NetBox with what he calls a “one foot on the brake approach.” Now 32, David has built NetBox into a formidable company with annual sales of $30 million and 20 staff. Having started the business at 22, he remembers the sacrifices he had to make in order to get started early. “It was two-and-a-half years before I was taking home a proper wage, which is quite a long time to be living like a university student when you’re not at university anymore.”
3. Be willing to rough it (in the beginning). Peter Mavridis, the founder and Managing Director of a Melbourne IT Services company, S Central is turning over $80 million every year and has a personal net worth of $62 million at the age of 37. Last year when Mavridis was listed in the Young Rich List, his personal wealth was $100m but has come back this year due to the financial climate of the last 12 months. However, in the beginning Mavridis wasn’t talking millions. He remembers the first office he and his girlfriend leased in Melbourne. “It was one of those offices where you were scared to take the lift, so you’d take the stairs.” Mavridis now owes a lot of his success to the fact that he didn’t spend the money he didn’t have, in the early days. Stay tuned for Part 2 in the next issue of thinkBIG. Jack Delosa discusses more strategies we can take from the Young Rich, and offers further insight into how to accelerate the growth of your business. TB
Jack Delosa is the General Manager of MBE Education. Jack was recently named as one of the top 30 entrepreneurs under 30, in Australian Anthill’s 30Under30 Publication. jack@mbeeducation.com.au
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feature think thinkBIG
The wall of defensiveness:
7 ways to tear it down By Ari Galper, founder of Unlock The Game™
Have you ever become frustrated when you realise that your prospects keep stereotyping you as a ‘salesperson’? And because of that, they don’t give you the trust and openness that you deserve and that are essential if you’re going to help them solve their problems?
T
hat’s what’s been happening to Michael, who calls companies to set appointments with decision makers. “I have a great product that I’m passionate about,” he told me, “but when I call prospects, they immediately start treating me as just another salesperson who’s trying to sell them the same type of product that others have tried to sell to them in the past...Is there any way to stop them from pigeonholing me?” Michael is hitting what I call the ‘wall of defensiveness’ that almost all decision makers these days use to protect themselves against sales calls. And none of the sales training or motivational programs he’s been through had helped him to solve this frustrating and debilitating situation. In our one-on-one sessions, Michael and I discussed seven key strategies that can break down that wall, and he’s been finding that they work for him...maybe they’ll work for you too...Here they are... 1. Curb your enthusiasm. This idea always comes as a shock to anyone who’s been exposed to the old ‘sales gurus’ who insist, “The more enthusiastic you are about what you are selling, the more people will be attracted to your solution”— but, boy, are they wrong! When you come across as overly enthusiastic, especially when you’re on a first call to a new prospect, you immediately trigger sales pressure that tell your prospect, “I’m excited because I just know that you need what I have to offer!” But in any new situation, that’s exactly what you don’t know--so try cutting out your enthusiasm on initial calls. Otherwise, you’re likely to hit the wall. 2. Avoid assuming that you and your prospect are a fit. You may have the ‘perfect prospect’ – someone with the exact criteria and profile of your ideal customer. However, if your words or tone of voice say, “I know you’ll benefit from our service because you fit the exact profile of our customer base,” you’ll inadvertently set off alarms that will let your prospect associate you with the negative salesperson stereotype. Instead, learn to be humble, and avoid making assumptions until after your prospects trust you enough to share their true issues with you. Then the two of you can decide, in a natural evolutionary way, whether you’re a match or not. 3. Don’t think that you have to have all the answers or you’ll ‘lose’ the sale. So many of us work ourselves into frenzy before we
actually pick up the phone to call someone. Why? We’re afraid that if we make a mistake or don’t deliver our pitch perfectly, we’ll be rejected. It’s okay not to have all the answers. Needing to have all the answers is a control trip, and when you’re with a prospect, you’re not in control--the two of you are in a relationship. The more you internalise that realisation, the more comfortable and less frenzied you’ll feel. And you’ll be surprised when your prospect appreciates you for being just another human being. 4. Don’t try to overcome objections. Overcoming objections doesn’t build trust. Instead, it only associates you with the negative stereotype that has been trained to move the sales process forward at the prospect’s expense. When you hear an objection, diffuse it and re-engage the conversation on your prospect’s terms. 5. Learn to diffuse sales pressure. Hidden sales pressure is the root of all sales woes. Diffuse it at the beginning of the relationship, and you’ll never have to deal with it again. Shift your mindset and change your language so it reflects you being your most natural self. The most sophisticated sales strategies won’t make any difference if you don’t know how to diffuse the sales pressure that prospects are only too quick to sense – and back away from – in any buyer-seller relationship. 6. View prospects as potential friends, not as sources of commissions. If you see dollar signs instead of human beings when you’re with prospects, they’ll sense your attitude and see those dollar signs in your eyes. Keep your conversations human by always viewing your prospects as people who have potential problems that you can solve. 7. Acknowledging the sales game diffuses the pressure. If you find yourself in a sales situation that puts your relationship with your prospect at risk – for example, a prospect promises to call you back but doesn’t – call the ‘game’. Call your prospect and say simply and gently that you really don’t want the relationship to degenerate into the stereotypical cat-and-mouse sales game. Your message should always be, “Our relationship, not my commission, is my priority.” The bottom line of all this is: You can no longer rely on what you are selling to distinguish yourself, because there’s just too much competition out there. Instead, you must focus on how you’re selling. That’s the only thing that will make you different from everyone else. TB
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feature think thinkBIG By Carly Crutchfield
The 7 stages OF
property
DEVELOPMENT
Join the Club and enjoy Australia’s largest collection of Supercars
PART 2
Last issue I showed you how to go about finding a development site, but how do you know if they are anything more than possibilities? Well as I said, Property Development is a matter of applying seven simple steps. So now you know how to go about Step 1 – Finding a Development Site, it is time to learn how to do Step 2 - Site Analysis.
Once you have made a rough costing and you know that there is profit potential in the development then it is time to take other matters into consideration such as council guidelines and zoning. The local council is a great source of information. If the site is already DA approved then a lot of the work has been done already. The architect and engineer who did the approved plans may be able to provide valuable information. Another area that you will need to research is any environmental factors that may have an impact on the success of the development such as access to water, sewerage, telecommunications and power. These can be costly if not already provided. This is the stage where you will have to take a look at the actual site by visiting it so that you get to see anything that may not be visible on aerial maps or drawings such as power lines that may run through the site. You will need to look for things such as heritage issues in the area, liability to flooding, land easements and even the viability of drilling into the ground.
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Quick calculation
O
nce you have found a site you need to be able to do a quick calculation to assess whether or not it is worth spending more time on. You need to know your basic costs in order to make a rough calculation such as land purchase cost, building costs, retail value once built and consultant costs. These costs are relatively easy to approximate and at this stage you are only jotting down estimates to see if is something worth pursuing. For example if you saw a development site with approval for six Townhouses you would do a quick calculation to see if it may be profitable:
Site: 6 Townhouses Income
= $3,000,000
Land Cost
= $900,000
Building Costs
= $1,200,000
Consultant costs
= $50,000
Stamp Duty
= $16,000
Selling fees
= $90,000
Check out the local council Profit = $744,000
• Water • Sewerage • Telecommunications
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• Power • Flood issues • Easements • Caveats • Soil type • Rates or taxes owning
Individual and Corporate Memberships now available from $19,000* per annum. Please contact Peter Dempsey for more information on 02 9969 7344.
• Heritage issues
Demographics of an area are really important Demographics of the area will also have a huge impact on the development. You will need to know who will buy in the area, what type of housing is needed, is there a shortage of certain types of dwellings, is the area predominantly single people or couples, families or elderly people? These answers will all have an impact on what you build, how many bedrooms you will need,
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feature think thinkBIG what size houses are most likely to sell, and therefore will also have a huge impact on your profits as you need sell something the area requires.
What is happening in the area? While it is important to check the current market, it is also important to check out anything that may affect it in the future such as planned infrastructure. This will give you a better idea of what to build. By finding out the demographics and the future planned infrastructure you are then able to build properties that you will have no problem selling. Doing a site analysis is one of the most important steps in property development. You want to make sure that your project suits local requirements and is therefore targeted at the right market. Continued market research will allow you to see what areas are experiencing a growth and which area is experiencing a decline so that you are not developing in an area that it is going to be difficult to sell. By checking out the local real estate market, you will be able to see how long it is taking properties to sell in the area you are looking to develop in. This will give you a good indication on how quickly you will be able to sell and how quickly you will make your profits. But I will focus more on selling at step 7 – selling.
What are my choices? The main two types of sites are DA approved or Raw. A Raw site has no planning approved and based on local council zoning guides, is up to you to research and decide what you can put on
the site. A DA approved site has a lot of the work done already. With plans approved, there is a lot less that you need to do as the architect and engineer’s plans will have already been drawn up. If you wish to make a slight variation to the DA then this is possible and may be accomplished by applying to the local council. This is the stage where you fully analyse and get acquainted with the site. You will also need to look for anything that may be owing on the site such as rates or taxes. Council will have a big impact on what you can build so you will need to familiarise yourself with the terminology. Jump on their website and browse around the different planning maps and zoning guidelines for the area. You will be able to find out from council, information such as the minimum size per site, any street frontage requirements, any specific building materials that must be used and the development plan for the area. Once you have determined through a quick calculation that the development is worth looking into further and you have done your market research on the area and researched the site, then the next step is to run a detailed feasibility with actual cost of everything involved to see what your profits will be. Negotiating is a key and a major influence on the profitability of any development but I will be telling you more about Step 3 – Financial Feasibility, in the next issue. Log onto www.cdevelop. com.au to download free reports and find out more about the courses we offer on Property development. TB
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Inspiring Stories Welcome to our new Inspiring Stories page. This page covers all those people around the globe whose acts of bravery, courage, skill and determination have changed or inspired the lives of others. We’ll also take a look at new inventions that could potentially have significant positive impact on those less fortunate. So let’s take a minute to reflect on the power of positive thinking and action.
Project talent finder
19 smiles of hard road
George Ouellette is a retired United States salesman, but still works up to six or seven hours per day to help put smiles on the faces of children in need. At 84-year-old, George walks through parks, along busy roads and rummages through garbage cans to collect cans and bottles reimbursable for five-cents each at the local recycling centre. George usually collects about $250 a week (100,000 cans) which he then writes up as a cheque to Operation Smile for the full amount. Operation Smile is a global initiative which turns children’s cleft palates into big smiles. One operation costs just $240. Since 2005, Ouellette has raised a total of $4,440 providing 19 surgeries for children suffering from clefts.
Projects, or in Australian parlance commission estates, will share a £10m fund to help young people from poorer communities unlock their talents. Fifteen projects from deprived neighbourhoods across England will share the funding. These areas identified the children as citing low aspiration as a barrier to achieving their potential. Known as the Inspiring Communities initiative, the scheme is intended to get people working together in their communities to boost the aspirations and achievements of their young people. Local Government Minister Rosie Winterton said: “We recognise that young people from poorer communities can be less likely to aim high and can have low self esteem, low aspirations and limited horizons that act as barriers to success. “This fund is about taking steps to redress that balance and goes to support those community-led projects that will best foster young people’s talents.”
Miracle in a Box
Is it a miracle in a box or the next step in scientific evolution to get people with serious injuries back on their feet and walking properly? Twenty-five year-old Tina Mann will tell you it’s both. The box in question is the Walkaide which is about the size of an iPod and uses technology similar to what makes a Wii videogame work. It sends electrical impulses to the nerves and muscles of the lower leg, enabling its user to pick up his or her foot. The WalkAide is reported to be able to help restore mobility for people with multiple sclerosis, cerebral palsy and traumatic brain injuries. Tina Mann, who was told she would never walk again after a snowboarding accident at age 16, said she is walking again with a WalkAide. Mann’s injury to her spinal cord paralysed her from the waist down, and even with extensive therapy, she could never walk without assistance. However, walking wasn’t enough for Mann. She wanted to face her fear of getting on a snowboard again -- and she did. “This is my miracle in a box,” Mann said. “This gave me my life. And I’m just excited to see how far I can truly go. ...My possibilities are truly endless.” Mann has taken part in a rockclimbing competition, and regularly does strength training. No doubt the ‘miracle box’ has had some important role to play in Tina’s rehabilitation, but you also get the impression that her willpower and determination has also played a major part. 66 thinkBIG
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Thought Leadership Reviews edited by Daniel G. Taylor Daniel G. Taylor publishes a weekly e-newsletter – Thought Leadership – spotlighting ideas from the best success books. Email daniel@danielgtaylor.com to subscribe.
Time Rich by Jamie McIntyre Eat. Taste. Nourish by Zoe Bingley-Pullin It is difficult to go past nutritionist-to-the-stars Zoe Bingley-Pullin’s recipe book offering fabulous food for body and soul. She shares how she discovered the joy of good food at the Le Cordon Bleu school in London – and gained 10kg. Later, in the south of France, despite eating plenty of provencal food, her waistline dropped. Inspired, Zoe looked at how she’d started to look trimmer and slimmer, while feeling healthier and vibrant. She found that her relationship to food was changed through the simple elegance of food
preparation and presentation in Provence. Using fresh, local ingredients and offering dishes with low-GI choices, Zoe uses no-fuss recipes to guide the reader through a daily eating plan. She also offers an easy twenty step guide on how to make small changes. The recipes are tasty and enticingly photographed. Follow her list of ‘Foods to Avoid and Foods to Have’ and you’ll be on your way to sharing in Zoe’s weight loss secret. Reviewed by L.K. Denning
Be. Do. Live. by Rajeev Dewan If Dr Stephen R. Covey and Anthony Robbins were to team up to write a book, Be. Do. Live. might be the result. Rajeev Dewan, who has been trained by both those authors, provides a roadmap for how to improve your character and your results. Work out what you want and see where you’re at now. Look next at your beliefs and change the useless ones. Got the foundations right? Ramp up the actions you take to get the best results. Dewan is a great synthesiser: he brings together the best ideas,
adds his twist, and gives them to you as tools to aid you with specific problems. One example of this is what he does with the classic Covey funeral exercise – where you imagine people sharing what they admired about you at your funeral – and takes it deeper than the original did, making the exercise more moving and more practical at once. With this solid debut, Dewan is on the path to sharing greatness with the Coveys and the Robbinses. Reviewed by Daniel G. Taylor
Managing Across Cultures by Charlene M. Solomon & Michael S. Schell Apart from the KKK, can you name any organization that’s not made up of people from any number of cultures? The management challenge is how to bring together people from all over the world to achieve results. When Wal-Mart tried to crack the German market, they failed. Why? They ran the store as if it was in America: including smiling greeters and people ready to help you find what you’re looking. But the Germans reserve smiling for close friends and family; many women
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The big challenge of time management is to do things more effectively – not just faster. Do things as fast as you can and you’ll never get as much done as an effective time manager who knows how to delegate: outsourcing your mind into the actions of others. In Time Rich, Jamie McIntyre synthesises ideas from the best new thinking on time management to come up with tips and tools to help you be more effective. One key is to hire a virtual assistant to handle the tasks that need doing but hold you back from your core
genius. Another key: use technology to aid your effectiveness. Your phone and email should be a tool and not your master; use them to be contacted on your terms. Before reading this book I’d take days/months/years to get through my emails, now whenever I’m travelling or waiting for an appointment, I jump on my iPhone and zip through them. If you know you could be using your time better, this book will help get you on track. Reviewed by Daniel G. Taylor
101 Ways to Get Out of Debt and on the Road to Wealth by Ashley Ormond Our increased awareness of the cost of debt has been a benefit of the GFC. Simple awareness, though, doesn’t fix the problem - that’s where Ashley Ormond’s book steps in. First, collect all the information about your debts – size, interest rates, fees, etc., so you really know your finances. From there, Ormond leads you to a wealth of tips to deal with the major types of debts: mortgages, credit cards, personal loans, investment loans, and small business debts. Finally, learn how to stay out
of debt. While easy-to-read, the ideas are harder to implement – we are talking about ingrained money habits – so start with changes you feel comfortable making, and as you get results, make harder changes. The most useful tip I got from the book are the calendars for tracking your monthly balance targets, so if you get off track, you have feedback to see why. Whatever kind of debt you have, here’s the help to get out of debt. Reviewed by Daniel G. Taylor
5 Minds for the Future by Howard Gardner
thought the greeters were flirting. As for the helpers? Germans like to find their own way and felt hassled, not realising the helpers were staff. Entrepreneurs take note: you can use this book to judge whether a business that has worked well in another country might work well in your country. It’s a harder-than-pulp read, but it’s worth it if you run a team with people from other cultures, to make sure everyone understands each other. Reviewed by Daniel G. Taylor
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Who wants to be a leading thinker? In the information age, your earning ability is the sum of three things: the quality and breadth of your information, and how you think about it. Gardner explores five mindsets, and you need a pass in each to get the big money: the Disciplined Mind, the practice of ongoing structured learning; the Synthesizing Mind, blending the best ideas from diverse sources; the Creating Mind, solving problems creatively; the Respectful Mind, knowing how to belong
to a group; and, the Ethical Mind, seeing and doing the right thing. Master these five mindsets and you’ll be able to pull in the big money. My natural strength is as a Synthesizer, gained from the high number of books I read as Reviews Editor and the thinking I do about them. My weakness is in the Respectful area; I tend to put myself ahead of others, most of the time. The payoff for becoming the leading thinker: becoming a millionaire. Reviewed by Daniel G. Taylor
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California
knows how to
party ..and just like a party, the redeeming feature of this $500,000 prancing horse is not its looks, its handling, power, or even its folding roof – it’s the soundtrack!
I
am convinced that they spent as much time engineering the engine and exhaust note on the California as they did any other part of the car. Words cannot describe how good this car sounds. I’m also sure the only reason the manufacturers made it convertible is so that you can better hear the screaming V8 as you rip through the gears on your way to a limited 310km/h. The California is a step in a new direction for Ferrari. Designed to be more versatile, with the engine in the front, a boot (although you don’t want to be packing more than a
briefcase), folding hardtop, plush interior and designer looks, it will go head to head with cars such as the Aston Martin DBS Volante, Mercedes Benz SL600, Lamborghini Gallardo Spyder, Porsche 911 Turbo cabriolet and the upcoming Maserati Gran Turismo Convertible. If you have half a million dollars to drop on a car, the choice has never been better! Many purists have questioned whether Ferrari, famous for F1 style road cars, can (or should) build a car like the California. Many fear it will lose the essence of what Ferrari is all about. But I think they have done it. It certainly sounds the
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part, looks fantastic and handles extremely well. It draws plenty of attention as you’d expect. Style wise the California is the first Ferrari I have ever seen where the rear looks better that the front, especially with the roof up. The engine is a torque-biased evolution of the F430s 4.3-litre V8 with direct injection, mated to a new DSG-style seven-speed dual-clutch transmission. A match made in heaven. When you are accelerating hard, the engine screams that trademark Ferrari high pitched wail, then when you pull the right gear lever to change up, the engine snaps and cracks into the next gear as your rocket forward even faster. It sounds as if the car is ejecting the gears out of the tailpipes – no longer required – as it accelerates like the world is about to end. It’s that dramatic. Do it in a tunnel, roof off and it will literally make your hairs stand on end. You will notice that the bonnet is very long, that is because the V8 is mounted behind the front axles for better weight distribution. I don’t know how they shoved it in there but they did. The flywheel must literally be underneath the Sat Nav screen. The engine bay is so beautiful – I’m surprised there is not an option for a clear plastic bonnet. I’m sure many buyers would take it. Oh did I mention that there are rear seats? Technically anyway. They are not practical for adults or long trips but you can shove someone back there. If they sit sideways and you take the roof off, it’s not that bad and there were plenty of volunteers who didn’t mind the zero legroom. It’s all good fun if you ask me. The back seats are fantastic for luggage, laptop, small kids and the like. This is a hugely practical supercar – something you can genuinely take up into the country for a few days – luggage and all. Or just use as an everyday car. Inside, it’s as plush as any luxury BMW, Audi or Merc. Looking dead ahead it’s all business with a big yellow tacho, sports steering wheel and paddle shift levers. Turn your head to the left and the interior is filled with plush tan leather, comfy electric adjustable seats and brushed aluminium. It’s impressive by any standards. Push the big red START button and the V8 fires up with a deliberate and impressive growl. It’s loud enough to scare any bystanders. The engine then settles into a quiet rumble – like a big bear sleeping. Unlike many supercars, the California can be driven in a relaxed and quiet manner around town. Pop the gearbox into auto mode and so long as you don’t nail the throttle (easier said than done), it will trundle quietly and calmly around Sydney. The exhaust only comes to life if you want it to. So who will buy the California? Well rich people of course but more specifically, this is a car that the wife can use to do a bit of shopping and the husband can use for track days. Then the both of them can throw in some weekend luggage and head up the coast to the weekend retreat. It’s the best of both worlds: cruisey, crazy, quiet and refined, fast and exciting. It has supercar looks, designer appeal, hardtop practicality and convertible fun. Is it worth $479,000 + on roads? Of course not – no car is. But common sense and value for money has never been a selling
feature of the Ferrari. However for those who are cashed up and have a passion for all things beautiful, it’s certainly a good choice. Thanks goes to the Supercar Club for letting thinkBIG experience the Ferrari California. For a fraction of the price of the California, and without all the maintenance and insurance hassles of supercar ownership, members can experience some of the worlds most exciting and exclusive supercars. For more information, visit www.supercarclub.com.au TB
Ferrari California Spec Sheet Price: $472,000 + ORC Engine: 4.3-litre 32-valve V8. 338kW @ 7750rpm/ 485Nm @ 5000rpm Transmission: Seven-speed double-clutch automated manual Performance: 0-100km/h 3.9 sec. 0-400 m 12.2 seconds, Top speed 310km/h Consumption: 13.1litres/100km / 305g/km
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What do fast-growth companies do that you aren’t doing - yet? Would you like to grow your revenue and make your business outrageously profitable without working yourself into the ground? Dear Entrepreneur, We both know that starting and running a small business can be a long, hard slog at times. Perhaps, like me, you’ve done more than a few 80 hours weeks since you started this journey. And perhaps we’ve both told ourselves, “that’s just what it takes to get a business of the ground and grow it into something truly successful.”
The key to making it work for us was an early investment in systems. Right at the start of our growth, while the company was still only 5 people, we experimented with technologies, we started leveraging the Internet, we spent a fortune with programmers and we made the business highly automated. Revenue per employee (a much-overlooked metric in my book) increased 2.7 times.
That’s true...up to a point. Few market-dominating, undustry-leading, wealthy businesses have ever been started without a lot of sweat and hard work by the founder.
Now you can automate your business in the same way...but without make the mistakes along the way that we did and without spending anywhere as much money to get the same result.
But you can only do so much, and there comes a point early on where the business needs to grow beyond your own efforts. At that point you face a choice, with two options in front of you:
We’ve taken the automated software systems that we created for Universal Events, and made them available to other entreprenurial businesses for an affordable monthly subscription through I.T. on Tap.
1. Leverage through people: you can grow by hiring a lot of employees, and deal with the challenges of recruiting and managing a much larger team - and the much larger wages bill that comes with it.
To date, several dozen entrepreneurs have used our systems for online marketing, sales, operations, and admin to transform their established offline businesses into automated revenue machines.
2. Invest in systems: you can automate your business as much as possible, drive up your revenue per employee and profit margins together, creating a truly scalable business with the foundations for much more growth in the process.
If your business has 4-45 employees
Of course in time you’ll probably do both, but here’s a secret that most entrepreneurs don’t learn until much too late: Put good systems into your business early - long before you probably think you’re ready - and you’ll set yourself up for shorter working hours, a lot less stress and a ton more profit. My wife Karen and I have had one of our businesses, Universal Events, ranked on the BRW Magazine Fast 100 list for the 3rd year in a row this year. It’s been one of the 100 fastest-growing companies in Australia in 2007, 2008 and 2009. At one stage that business grew 16 times in only 3 years - that was a wild ride and not always fun either! Let me tell you that at times it was tough holding the business together while it expanded so fast. We had challenges with hiring and training people quickly, maintaining customer service standards and staying sane while we did it.
www.ITonTap.com call us on 02 9925 8007 or email info@itontap.com
If you’re ready, we’d like to offer the same to you.
If you think you could bring in a lot more customers by executing the right Internet marketing strategies If you’d like to cap or reduce labour costs in your business while still growing revenue rapidly ...then you’ll want to take a closer look at I.T. on Tap - the diagram above right will give you an overview. Contact us and join a free webinar to learn more, have a no-obligation discussion about your business, or try us out with a 30 day free trial. Talk to you soon!
Ken Wood Chief Tap Turner I.T. on Tap
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When Performance Counts
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