Tasmanian Business Reporter February 2018

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8 Tasmanian Business Reporter - FEBRUARY 2018 THOUGHT LEADERSHIP www.tcci.com.au India a multitude of markets Sally Chandler Tradestart Adviser INDIA is not one market, it is very fragmented. It is also very, very price sensitive. An exporter needs patience and perseverance as India is a very different place to do business. It is a mistake to assume India is one market and exporters must have a regional, targeted, niche approach that is very price aware. As well as first tier cities, exporters need to think of second and third tier cities as well and innovate to drive down price. Indian companies won’t necessarily buy Australian. India has very high levels of self-sufficiency, especially in resources and agriculture. Its growth is services led. Online consumer goods will leapfrog China particularly in non-metropolitan cities because there are limited shopping malls. The focus is on customer service and price and exporters must collaborate with offline partners to go online. For retail consumer goods, the number of Indian middle class is one fifth the size of China and half the salary level. Forty percent of these are government employees and the average annual salary is $A3000 per annum. Half the population is vegetarian. India is the second largest spirits market in the world and the largest milk consumer in the world. It is very hard to penetrate the high-end market but there are opportunities for packaged snacks and spirits, particularly whisky. By 2050 the Indian Government will have developed 100 cities across India and by then Opportunities exist but potential exporters to India need patience and perseverance. 900 million people will live in cities. Opportunities exist for infrastructure consulting on rail, water, green cities and hydro developments, also on desalination, waste water, renewable energy and smart grids. Intelligent transport solutions such as ticketing systems, vehicle tracking systems and road safety enhancements are also required. Austrade has a large presence in India with 10 offices in New Delhi, Mumbai, Chennai, Kolkata, Chandigarh, Jaipur, Ahmedabad, Bangalore, Hyderabad and Kochi. With Austrade, I can assist Tasmanian exporters considering the Indian market for their products or services. For international trade and investment assistance contact the TCCI’s TradeStart Adviser, Sally Chandler, at sally.chandler@tcci. com.au or phone 1300 559 122. Enter confined spaces with great care Craig Hortle Workplace Health & Safety IN THE last few months we have discussed the issues of entering a confined space. The code of practice for confined spaces gives practical guidance of how identify and information on how to enter a confined space. Why is a confined space particularly dangerous? The outcome of accidents in this environment can easily be catastrophic and lead to the multiple deaths in one event. If you consider the some of the hazards involved; • loss of oxygen; • electrocution; • engulfment; • explosion. All of these hazards would have high or severe risk ranking result in the catastrophic outcome for those working in the confined space. What conditions could lead to producing the hazards that are mentioned; Loss of oxygen • Welding in the confined space – producing gas that replaces oxygen; • Residual chemicals that may produce gas that replaces oxygen; • Residual product natural or man-made that ferments or produces gas that replaces oxygen in the atmosphere; • Escaping gas from another source that enters the confined space and replaces the oxygen in the atmosphere. Electrocution • Not isolating electrical fittings associated with the confined space; • Using tools that have connection to 240v and not using a RCD; • Welding using arc welding techniques. Engulfment • Not isolating product supply and drain lines; • Working in confined spaces that are not completely empty; • Working in confined spaces containing grain, sand or other viscose products. Explosion • High levels of explosive gas in confined space; • Welding in confined space; • Flammable dust in the confined space All of these conditions can occur simply and without warning - that is why it is essential to carry out a high-level risk assessment before entering the tank and ensuring all who involved in the activity are trained in the entry to confined spaces. For more information please contact Craig Hortle or Janelle Whitehouse at the TCCI on 1300 559 122 or contact safety@ TCCI.com.au
THOUGHT LEADERSHIP Brett Charlton Agility Logistics WELCOME to 2018 – even numbers are always better in my OCD world so I am very much looking forward to an excellent year ahead. The sun is out, the crops look good, there are cranes in the skies, exporters are predicting growth, North and South Korea have agreed to skate on the ice together – it is a great time to be fighting gravity on our blue bubble (perhaps not for 40 minutes in Hawaii recently when they accidently sent out a thermal nuclear destruction text by error, but nevertheless….). From a shipping point of view, in Tasmania we are still in the enviable position of having a small market serviced well domestically and internationally. These are the days of miracle and wonder By all accounts the movement of goods to and from Tasmania has been well catered with our capacity over the traditionally busy period of Christmas and perishable season. The announcement of TT Line extra capacity for freight in the future as well as the new Toll vessels is welcomed news that is also met with some caution – an oversupply of capacity questions sustainability and government-run enterprises competing in the private sector has raised some eyebrows. Hopefully any questions of surplus capacity are countered by investment and growth in our trading businesses to fill any empty spaces. Internationally we are still serviced by the ma- Tasmanian Business Reporter - FEBRUARY 2018 9 www.tcci.com.au Anticipating excellent year ahead You’ve decided to buy a business, now what? THE summer holidays are when decisions to buy a business most often occur. I suppose its because you’ve had some leave, had time to think and talk to your partner and decided that wages plus super isn’t enough any more. So what sort of business should you look for? My advice to people looking to buy a business is simple: Dean Demeyer Business Broker 1. Buy a business that is profitable; and 2. has identifiable problem areas you know how to solve. This creates a positive cash flow from day one, and you are able to apply Extra capacity across Bass Strait on TT Line vessels is a welcome development. jor shipping lines with a healthy competition evolving on some trade lanes. your knowledge and skill to fix the problems and improve the business. It’s this improvement and expanding the cash flow that gives you gains now and a bigger gain when the business is Importers ex-Asia however are unfortunately caught in the capacity issues ex these regions eventually sold. Why? Because businesses sell on multiples of cash flow. Let’s say you pay $200,000 for a business earning a $100,000 net profit – the multiple is and as a result should expect more pain points around space and price until after Chinese New There are plenty of profitable businesses on the market. obviously two. If you increase the cash flow by fixing the problems you identified and increase the cash flow to $150,000, your selling price is a minimum $300,000. Year – it is not expected that the freight levels will drop to the low prices that importers enjoyed Plus don’t forget you have an extra $50,000 of profit every year of owning the business. This is the safest option when buying a business. There are plenty of profitable businesses on the market. But be careful you don’t pay for the skills and knowledge you bring to the table. Otherwise everything for many years and traders would be wise to consider very early planning for next year’s critical volume periods (September – February). I am personally interested to see how 2018 plays out in the technological world. I find myself both excited and frustrated at the same time by the advances and the possibilities – I often feel that behind the shiny facade, things are still held together by sticky tape and baling twine (imminent thermal nuclear destruction messages being a case in point). Last year we had a cyber-attack that closed down the largest shipping line on the planet from someone opening a link on an email, but during that same time I could put on a headset and instantly be under water watching a whale swim by. “These are the days of miracle and wonder” said someone that most people past Gen X wouldn’t have heard of. Good luck out there. I’ve talked about above is redundant and you will work hard just to get back the price you paid. Strategic purchasers who benefit from buying physical assets, customers lists, prime locations or people skills held within the target business, are the best buyers for businesses with small net cash flow. But that’s a topic for another day. BUSINESS 2 BUSINESS YOUR QUICK GUIDE TO SERVICES AND PRODUCTS FOR YOUR BUSINESS HOBART’S BEST RANGE OF QUALITY ERGONOMIC FURNITURE FOR THE HOME AND OFFICE We specialise in high quality ergonomic chairs, alternative seating and electronic sit/stand desks. Flair Office Furniture has been providing quality, affordable office furniture to homes and offices throughout the Hobart region for nearly 15 years. We’re a locally-based, family-run business specialising in all types of products, so why not visit us today to see our fantastic range? www.flairofficefurniture.com.au Phone 6234 1127 260 Argyle Street, North Hobart To see your business here, call Kerri on 0419 750 267 or email kerri@thetrustedmediaco.com Your Partner in Print. www.footandplaysted.com.au Now incorporating THE CRAFT LIVES ON.
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Tasmanian Business Reporter February 2018

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