Over 160 reasons to celebrate

By Tina Zawila and Steve Marsten

On 1^st April 1977, two accountants joined in partnership to become Fagg and Cathcart here in Gladstone, and that was the beginning of the firm we now call Sothertons.  40 years later, after a few name changes and a few retired partners, Steve Marsten and Tina Zawila lead a team of nine dedicated professionals.

So how do you celebrate 40 years, when you are accountants and business advisors?  Of course, you throw a party, but you also set some serious goals.

Our team are used to monthly, quarterly and annual goals and targets, but in our 40^th year, we knew we needed to step it up a notch.

So with a “40 theme” in mind, we came up with the following goals for 2017:

•          Identify and implement 40 Office Improvements.  These could be changes to our physical space, systems or processes to improve productivity and efficiency, or just to make us more comfortable in the office.
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•          Undertake 40 Professional or Personal Development activities.   PD is vital to enable us to provide our clients with excellent advice.  However, our own physical and mental well-being is just as important and so we recognised these achievements and activities too.
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•          Help 40 new clients.  We knew we had the capacity to help more people, so we attended networking events, offered obligation-free initial consultations, and provided advice and support to as many people in our community as we could.
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•          Finally, we wanted to give back to the community that has supported our business, so we set out to do 40 Good Deeds.  We have raised money and/or goods for charities, donated blood, taken on volunteer positions, and even put the neighbour’s bins out when they forgot!

As we enter the last working week of2017 we are proud to say we not only achieved, but exceeded the 160 target, and we have had a lot of fun along the way.   Now we look forward to 2018 and to new challenges. 

We wish you a very merry Christmas and a happy and prosperous 2018. 

If we can help you achieve your goals, please call us on 4972 1300.

Why Culture is important to your business

By Steve Marsten

Recently I was involved in a discussion about company values and their importance. The discussion began as a result of a report on Uber by US Attorney General Eric Holder. Uber of course has been a great success however clearly they have had some cultural issues within their business which is why the investigation took place.

As someone who uses taxis and cabs in capital cities a lot, I have been noticed that Taxi’s in particularly have lifted their game. Yes there are more taxi drivers who smile, who look more professional, who engage and who are now recognizing that the hygiene of their car makes a big difference to the customer experience.  Unfortunately it highlighted what many have always known – if you stand still you are going backwards.

 If a competitor offers an improved service – instead of whinging – 

lift your service. Better still – better the competitors service!

Long gone are the old style values of honesty, passion, collaboration, innovation …..zzzzzz. They’re all good and well but they are expected now! We want real values nowadays. The values that express the unique and driving ambition behind the company. Values that embody the spirit of the community and strategic direction. Values that truly connect people with their customers as well as each other. Values that connect everyone to one single minded purpose.

The culture of a business is a serious thing. It must come from the leaders within your business. What you adopt and act out  is what permeates your staff and gets exposed to your customer base. The larger the business grows the more frayed good culture becomes and the less focus is placed on it. Determine crosschecks from time to time is important to making sure things stay on track.

At Sothertons we have invested resources in making sure our culture is reviewed and acted on regularly. We stay in touch with our team daily. 

For more information on improving your culture and getting an edge on your competitors call us on 4972 1300. 

The Amazon Effect

By Tina Zawila

If you haven't heard this expression yet, you will soon become familiar. However, I'm certain you are already familiar with the US business Amazon which celebrates it's 20th birthday this year.

Whilst Amazon has had a presence in Australia for some time via its technology subsidiary Amazon Web Services, there are plans to open local retail operations here in the near future.  In fact Amazon Prime (the company’s fulfillment arm which delivers the goods to customers) could be up and running by mid-2018.

So what does this mean for our economy?  Investment bank UBS estimates “the Amazon effect” will potentially strip 0.25% from the Australian Consumer Price Index.  Citi Research predicts that Amazon could capture about $200m worth of the Australian retail market, with JB Hi Fi, Harvey Norman, Myer, Super Retail Group and footwear seller RCG most exposed.

In the US, Amazon Prime membership costs US$99 a year, which entitles you to free shipping in two days.  The more you buy, the better the deal.  Interestingly, AusPost recently launched Shipster, a membership program offering free shipping on eligible purchases for spends over $25 at participating online stores.

Australia’s ecommerce industry is about to be turned on its head.  Amazon has always played by different retail rules - rather than being focused on short-term profits, it focuses purely on achieving market leadership and cash flow.  The Amazon model in the US allows it to make US$1.2m in revenue per employee.  In Australia, that figure is currently around $200,000 to $300,000 in revenue per employee.  That is a major cost disadvantage for the average Australian retailer.

When the UBS, CommBank Retail Insights 2017, Euromonitor report states that “70% of consumers say they’re likely to buy from Amazon platform”, it’s time for Australian retailers to pay attention and prepare a strategy to deal with the disruption of their industry.

At Sothertons Gladstone we help business owners plan for the future and develop strategies to ensure business sustainability and growth.  Call us today on 4972 1300.

The Tax Man Takes a Little More!

By Steve Marsten

To all property investors - on Wednesday 15^th November, 2017 Parliament passed the Treasury Laws Amendment (Housing Tax Integrity) Bill. This is the biggest change to property investment rules in 15 years .

So an outline of the legislation is that all contracts entered into for second hand properties (purchased for investment purposes) after 7.30pm on 9^th May, 2017 will not get Depreciation deductions for existing plant and equipment assets and removable and mechanical assets.

Assets like Air conditioners; exhaust fans, garbage bins; smoke alarms; solar paneling and hot water systems; dishwashers and blinds etc. Note that new additional assets can still be claimed as before along with any capital works carried out on the purchased property after the contract has settled. Assets like sheds; carport or garage extensions and fencing etc.

Also what appears interesting is that contracts signed (but perhaps not settled prior to 7.30pm on the 9^th May 2017 do not appear to be affected. Not that there will be many of these.

Commercial property owners and tenants are unaffected by the legislation and should be business as usual. They will continue to claim deductions on building structures (subject to original build dates etc) as well as wear and tear on plant and equipment assets.

Assets affected by the change in legislation may still be useful in reducing future capital gains or increasing capital losses.

And finally the Quantity surveyors will not be out of a job in respect to the need for investors buying new properties or still requiring an assessment on the original build cost for the capital allowance claims. Their property reports are still essential for supporting depreciation and capital allowance claims. Also the cost of getting a Quantity surveyors report on an investment property still remains tax deductible.

So if you have any question on property and tax feel free to ring the experienced team at Sothertons on 4972 1300.

Passion, Persistence and Patience

By Tina Zawila

If you are in business or are a business student, you have probably heard of the “4P’s of Marketing” – Price, Product, Promotion and Place.  It is argued that executing a marketing mix using these 4Ps is crucial to a successful product offering. 

Today, I want to introduce you to another set of P’s that I believe are just as crucial to launching a successful product offering, and in fact, to operate a successful business:

Passion – I know its cliché, but you must be passionate about what you do and what you can offer your customers to be successful in business.  If you don’t believe in yourself, and your product and service, no one else will! 

Your team must also be on board.  I visited a workplace recently, where the team members were demonstrating a new product that they had been working on and they could hardly contain their pride and excitement – they even had their personal mobile phones out to take photos of the demo!  

Persistence –Again there are many quotes and examples of how success is born from preparation, hard work and learning from failure.  Successful entrepreneurs persist even when they make mistakes or encounter challenges.  They keep trying and accept failure as part of the process.

Patience - Things take time.  There is no such thing as a true overnight success story.  Many instant entrepreneurs have in fact spent years researching, developing and honing their ideas, skills and ultimately their product or service offering.   They have often had to wait for the right time in the market, and then be patient while their product or service is adopted, accepted and embraced by their customers.

At Sothertons Gladstone we support entrepreneurs and business owners throughout their business journey.  Call us today on 4972 1300 and share your passion, persistence and patience stories with us. 

The “Uber” for banking has arrived!

By Steve Marsten

Recently a bunch of Gladstone Businesses gathered to hear commentary from one of the big four banks. It was quite sobering as he candidly explained why it was necessary for the banking systems in Australia to change.

Currently 80% of all banking transactions is “preferred to be carried out by customers” on the internet. That’s probably true. Busy people do their banking at night. Most transactions and bill payments are currently being carried out via our phones, iPads and Laptops. 

Only 15% of customers “want” to walk into a bank. Clearly we can all see what’s coming. Why would a business maintain heaps of real estate and office space to service 15% of their clientele? AND that portion is shrinking.

What was also interesting is the speed in which Chinese banks are growing around the world. One Chinese financial institution that only operates online, has grown to 200 million customers in  just 2 years and is expected to double again in less then 12 months!

The other economic point is that it costs the average Chinese bank (who only operate online) 4c for every $1 of earnings they receive from customers. It costs Australian banks about 40 cents! Many people already think that Australian Banks are the bogeymen of big business however in the scheme of things they will need to compete in Global markets or face ever declining revenues and customer bases. I know many will say that “we would never use a foreign bank” but the fact is many people in this country are already using European and American banks. When foreign banks are established without the cost of real estate, its obvious to see them making very attractive offers to the Australian Market in the not too distant future that will lure many customers away from their traditional financial suppliers.

One Big bank has copped a hiding for saying that they will be laying of several thousand personnel. I think they are just being honest with their shareholders and their customers. This is going to be the case for all big banks in Australia. The future of the financial industry is going to change rapidly only this time their “Uber” is coming from Asia.

Remember for all your financial business advice contact the team at Sothertons on 49721300.

Play Together, Stay Together

By Tina Zawila

What are you doing for the Race that Stops the Nation today?  Most workplaces will at least stop for a few minutes to watch the Melbourne Cup, however, many will take the opportunity to take a long lunch or even take the afternoon off.  

Australians all over the country take annual leave to go the Cup itself, or to attend a function or race day locally.  

So what does this lost time cost business and our economy?  Clearly there is a loss of productivity, and for retailers business is slow at best, or even non-existent after lunch. 

However, for employers who embrace the Cup and take the opportunity to reward their team with some extra time over lunch and/or organise a team event/luncheon, what does this do to boost morale and promote employee loyalty?  Often the value of this flow on effect cannot be accurately estimated or measured.

The benefits of a happy and engaged team are often qualitative rather than quantitative however, there is a mountain of anecdotal evidence which proves that quantitative business results improve when employee turnover is low and moral is high.

People don’t leave roles, they leave people.  Looking after your team, offering them regular (even small) rewards will reap significant benefits.  The cost of recruitment is often much higher than the investment in rewarding and nurturing your team. 

Let us know what you do to reward your team.  Call Sothertons Gladstone on 49721300.