29 September 2015

"Do you know who you are in business with?” by Steve Marsten

One of the issues in business where I count my blessings is the integrity and loyalty that I have relied upon with my business partners, both past and present.
Business partnerships are almost as important as your marriage. In some cases more important because often it can involve a lot more debt and assets. So the question is, how well do you know your business partner? 
You need to know them Very, Very well!
I recently assisted a client secure some financing only to discover that his new business partner had some legal issues in a previous business career. As a result, the business was precluded from any reasonably priced financing. This also raised issues of integrity and honesty and caused some disruption within the partnership. The bank also wanted cross guarantees from each of them!
Such issues happen more often then not. I see it more regularly when we are dealing with people who have known their business partners for less then 12 months and hence they place blind faith and friendship ahead of the need to draw up a partnership agreement.
The fact is, people change, especially when under pressure. It's important to understand your potential partner's finances, time commitments, communicative personality and long-term goals, before making the relationship official.
You spend ample time dating before you get married and you should treat your relationship with a potential business partner the same way. Entering into a business partnership is a serious commitment of time, money and reputation. Knowing as much as possible about your business partner before formally signing on the dotted line to the partnership can save you a lot of trouble down the road.
Often - how your potential business partner manages their money can tell you a lot about how they will run your business. Although it might be uncomfortable to ask about certain matters, the “knowing” is more important.
Business is tough on a friendship if it does not have strong foundations. Equal commitment to the company is paramount. 

At Sothertons we spend considerable time assisting new business partners to understand the commitments ahead and identify matters to include in a partnership agreement that all will sign up to. For more information – feel free to call us on 07 4972 1300.

22 September 2015

“Dangerous Technology” by Tina Zawila

How many emails and text messages do you send/receive a day?
How many are sent to you that you didn’t receive, so you don’t even know about them?

How are all of these electronic messages affecting you and your relationships?

Just this week, I have heard half a dozen stories of how this electronic form of communication has led to misunderstanding, frustration and even damaged relationships.

It can be as simple as this – you send an email or text to someone asking them an important question or requesting that they do something for you.  Then you wait patiently for a reply.  Depending on the urgency, within hours, days or weeks, you become frustrated or disappointed that they haven’t replied or acted.  Eventually you might pick up the phone or you might bump into them in person and you finally ask why they didn’t reply to you, only to discover that they did not receive the message at all!   So your frustration, disappointment, anger or even feelings of resentment are totally unfounded, all due to the failure of technology, and dare I say it, the failure of our ability to communicate effectively with one another.

We are all living in a fast-paced society where efficiency and the effective use technology seem to be the Holy Grail.  We are all trying to “get things done” and dare I say even “document” all of our conversations  via email or text message.  However, in this pursuit of efficiency, I believe we are losing the art of communication and the sacrificing the reward of building genuine relationships with other human beings.  And in my opinion this is the danger of technology.

In a business environment these mishaps with electronic communication can have disastrous consequences and damage relationships that you have worked hard to nurture.  My advice, let’s get back to picking up the phone, or catching up face to face and use electronic communication carefully. 

Call us at Sothertons Gladstone on 49721300.

16 September 2015

"Beware the scam artists" by Steve Marsten

Scammers and fraudsters are alive and well here in Gladstone. This week a client was contacted via phone from someone claiming to be from Telstra. He even gave my client his “personal (Telstra) phone number” which looked legitimate. After several calls my client felt uneasy and realised his banking system had been compromised via his own computer. 
This is not the first example in Gladstone of the “Telstra employee” ringing to discuss checking your line or your bills. After a couple of hours all bank accounts, credit cards and phone lines had to be shut down. It can be debilitating and a nightmare to get re-established. Think of all the direct debits that may have to be changed over or as in this case, various direct credits from their investments had to be changed.
Yes its peak trading conditions for the fraudsters. Apparently over the past six months the ACCC revealed that approximately $45 million was siphoned out of Australian bank accounts and into the back pockets of these scam artists. The ACCC believes that this represent only 10% of the real scams being perpetuated on the average Australian. The average amount people are losing is $9,000 a claim. So it’s not small bickies.
Small business needs to be most wary about possible scams however it can happen to anyone. Scams to be on the lookout for include:
1.       Online shopping – if the sale is too good to be true, it probably is. Remember you get what you pay for.
2.       Always ask questions if you are unsure of the person or the company. Ask for their phone number then stick it in Google and see what comes up. Ask for their full name and ring the head office. Often if it’s legitimate - the home site should come up – if not more than likely you won’t have been the first one scammed!
3.       Never open suspicious attachments – ever! Often the email address is a giveaway; i.e. we recently saw an email supposedly from the ATO however 00ATO1.net was the giveaway. Australian organisations have very clear initials in their emails.
4.       Always use passwords to lock your digital devices and change them every few months.
5.       Never agree to transfer money or goods for another person. It may turn out to be money laundering.

And finally if it looks a little odd and doesn’t feel right, it’s often not right. Trust your intuition. 
At Sothertons we keep our clients scam aware whenever possible. Ring us for more information on 4972 1300.

08 September 2015

The Value is in the Relationship - By Tina Zawila

A few weeks ago I wrote an article on the notion that you "get what you pay for", referring to the principle that generally speaking the cheaper the price, the lower the quality.  I strongly encouraged everyone to choose their accountant or tax agent not based solely on price, but based on trust and confidence.  When it comes to your professional advisors - your accountant, your banker, your solicitor, you should choose the person or business based on your relationship with them.  

Therefore, take a moment to consider the following questions: 
- Can you talk openly and honestly with them?

- Do they know you, your circumstances, your business?

- Do you have confidence in their ability and knowledge?

- Can they explain things to you in a manner in which you understand?

- Do they have a professional and capable team to assist you if they are not around?

What value do you place on these factors?

In most industries we are spoilt for choice and many products and services are much the same. However, the people that operate the business and their team are all different.  They bring to the buying experience a feeling that accompanies the product or service.  Think about your favourite coffee shop - chances are if you are a regular customer, you will know the people who make your coffee, and whilst you could probably buy a similar coffee somewhere else, you generally like to go back to the cafe where they know you and your order.

At the end of the day, people do business with other people, not with the products or services they provide.  

If you are in business, think about your relationship with your customers or clients.  If you are a customer or client; think about who you like to do business with and why.  At Sothertons we care and we are committed to our clients.  Call us on 49721300 for a chat about how we can look after you.

01 September 2015

"And the roller coaster continues....." Article by Steve Marsten

It’s been another week of nervous markets and even more nervous investors. The week saw the Chinese stock market collapse by more then 17% in three days. It’s a true indication that the Chinese Economy is dealing with fundamental flaws. Though the general stock market plunge should not affect Australian stocks directly, we are more susceptible to the slumping Chinese economy.
On top of the issue of a sluggish China, you have a stock market buoyed by borrowed money to invest and inflate the stock market bubble. All very Storm Financial style and we all know where that left us! Even after the falls on their stockmarket, would you believe they are still over 30% above where they were 12 months ago while our market (the ASX) is down by 3%.
The other issue to consider is the Chinese government has been scrambling to halt the slide in its markets by reducing its interest rates. These now stand at 4.6% compared to Australia’s rate of 2%.
Meanwhile the economy that’s been on the improve is the US. Their market also caught a dose of the Chinese market flu! They fell by 10%. That said the S & P index has been travelling way above its pre GFC peak for about 2 years. This compares to Australia’s market that seems to be restrained and conservative in comparison as we have yet to reach our pre GFC peak.
The USA is also been impacted by the fact that over the last few years their Government has been pumping money into the economy via several quantitative easings. This was brought to halt some months ago and hence a correction to their market was always a possibility. That said their economy still has a reasonably good outlook.
The conclusions we can draw is every few years the markets take a deep breath and correct themselves. It’s expected. It’s part and parcel of the volatility of markets. If your portfolio is exposed to small caps or high risk companies – they tend to be even more volatile. If your portfolio is diversified amongst larger profitable companies then they are likely to recover first and foremost.

 At Sothertons understanding risk is part of anyone’s portfolio management. Markets going up or down should not be a big concern as long as objectives haven’t changed and your portfolio is diversified. To understand more call us on 4972 1300.