Bay of Plenty Business News June/July 2019

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10 BAY OF PLENTY BUSINESS NEWS June/July 2019 A reminder of reality Investment Market Update for the quarter ended 31 May 2019 Global economic growth, and in particular developed economy growth, has been pared back significantly since December 2018. Global manufacturing has been in a slump most of this year, with export powerhouses such as Germany and Japan likely to be suffering manufacturing recessions. On the positive side, employment growth has continued in most economies and rising household incomes have underpinned a more robust service sector. With limited reinvestment options, and interest rates expected to stay low or lower for some time, alternative investment options need to be considered. Weaker growth outlooks have caused Central Banks to reverse any policy bias towards further monetary policy tightening. As inflationary pressures have eased and economic data has softened, global bond yields have fallen. In China, the government has cut taxes and reduced interest costs in a bid to support the Chinese economy. New Zealand’s Reserve Bank cut the Official Cash Rate and other Central Banks have indicated further support will be forthcoming if needed. This monetary support, along with an expectation of a resolution to the US-China trade dispute, has lifted asset prices this year. However, in recent weeks as economic data has deteriorated and the trade dispute worsened, weakness has returned to market sentiment. Interest rate curves are now indicating rates will remain low for longer, with the US Federal Reserve expected to cut interest rates at least once later this year. Weakening market sentiment and economic growth also confirms the need for a premium-for-risk when investing in growth assets. Financial market impacts With trade concerns again escalating, the renewed focus on declining economic growth expectations meant most equity markets we follow declined during May 2019. US and Chinese markets bore the brunt of declines, and using the MSCI World Index as an example, the declines were sufficient to reverse the gains made in the preceding two months. At least the weaker New Zealand dollar helped returns from a New Zealand investors’ perspective, with the Kiwi falling against all currencies with the exception of the British pound. Australasian markets were the best performers and managed to buck the trend of losses during May 2019. Australian equities actually gained significantly during May 2019 and managed similar returns to those in New Zealand over the quarter. Driving the Australian rally was the trifecta of the surprise General Election result replacing expectations of higher taxes with tax cuts, the banking regulator easing stress tests on mortgages, and the Reserve Bank of Australia indicating it would also lower the Official Cash Rate. These measures are expected to stabilise the housing market and in turn bolster household spending. New Zealand’s performance was helped by the large weighting toward defensive sectors. However, good valuefor-risk is becoming difficult to find. Momentum has been driving the market’s performance and the price-earnings multiples for these companies have increased significantly year-to-date. Part of the reason has been the level of acquisition activity in the New Zealand equity market. Other factors are low interest rates and insufficient issuance to offset the maturity and redemption of $1.8 billion of high yielding subordinated debt instruments, which WHAT TO DO WITH YOUR MONEY > BY BRETT BELL-BOOTH Investment Adviser with Forsyth Barr Limited in Tauranga, and an Authorised Financial Adviser. Phone (07) 577 5725 or email brett.bell-booth@forsythbarr.co.nz. will occur over the next few months. With limited reinvestment options, and interest rates expected to stay low or lower for some time, alternative investment options need to be considered. This includes more diversification into international bond funds, as well as having to accept lower than usual fixed interest returns. This column is general in nature and is not personalised investment advice. This column has been prepared in good faith based on information obtained from sources believed to be reliable and accurate. Disclosure Statements for Forsyth Barr Authorised Financial Advisers are available on request and free of charge. Be benevolent in your business Giving is good. Good for the soul and, surprising though it may it seem, MONEY MATTERS > BY MICHELLE HILL Director and Partner at BDO Rotorua, Chartered Accountants and Advisers. To find out more visit bdorotorua.co.nz or email rotorua@bdo.co.nz good for your business. There is a growing trend among the most successful companies and organisations - without sacrificing profit and ever-valuable time - to incorporate an altruistic value and imperative into their organisation. Giving may seem to go against the grain of what businesses exist for. However, if done correctly you will find that your generosity will come back in more ways than one. Before you go spilling trade secrets and emptying your bank accounts, let’s investigate how best you can incorporate a bit of giving into your business. Empowering clients and customers is key to any successful relationship. Free, no-obligation meetings are a great way to demonstrate to any potential customer or client that they matter, and for everyone to understand whether they can work together. We live in an age where choice is plentiful. So what makes your product or service stand out among the others? Make a cost-free, no-obligation meeting a part of your company’s on boarding process. Any business looking to succeed should have some or all of the above suggestions imbued into any yearly plan. Company-hosted events are a great way to interact with your client base and the public in general. Hosting a yearly low/no cost event that will provide value and information of interest can solidify trust in your brand and provide great opportunities to get in front of and engage with those you would like to work with, or work further with. Even better, link up with any businesses you work with and expand your invite list while sharing costs. Despite how you may feel about social media, it can your best friend in business. What’s more, a well-executed plan can cost you nothing while providing a great space for your target market to find out more about what you do. Regular and relevant content is key, ensuring your online presence is insightful and engaging. Videos and images are a great way to stay in touch with your clients. Consider some regular industry updates too. Year on year newspaper readership is up 12.9 percent, according to a Roy Morgan survey. As a trusted source for industry updates and general business discourse, writing a regular column or opinion piece can cement your position as a trusted figure in a crowded space. Pick topics that will leave readers more knowledgeable, ensure it is relevant but not too specific. You can’t assume readers are specialists in your field. Any business looking to succeed should have some or all of the above suggestions imbued into any yearly plan. Doing so will ensure you exist for reasons other than just pure profit. If you are a business that exists for the betterment of the community and those within, this will come back in more ways than one to ensure you see success.
BAY OF PLENTY BUSINESS NEWS June/July 2019 11 To consent or not to consent? That is the question: Whether ‘tis nobler in the mind to suffer the slings and arrows of consumer confusion, or to take arms against a sea of potential troubles and by opposing end them. “What on earth is this guy talking about?” I hear you say. I’m talking about to consent - or not - to registration of an identical or similar trade mark to yours. Let me explain. The New Zealand Trade Marks Register has become very crowded, such are the numbers of registered trade marks now on it. It has consequently become quite common for a person seeking to register a new trade mark to find their application to do so “blocked” by one or more previous registrations. To overcome this hurdle, the applicant must either convince the trade marks examiner at the Intellectual Property Office that their mark is sufficiently distinctive from those preventing its registration, or it must obtain consent from the owners of the prior registrations. At first glance, a request for consent does not seem a particularly difficult question to answer. However, the consent request involves consideration of a number of issues, not least because the person asking could be a wolf in sheep’s clothing. The issues a trade mark owner needs to consider include: If I consent, what is the impact on the distinctiveness of my trade mark? Is confusion among my existing and potential customers likely to result? If I consent, what is the potential effect on where my business trades now and where it may trade in the future? If I consent, and a problem arises in the future because of how the other person has used their trade mark, am I prevented from taking action? If I don’t consent, will the other person attack my registration? Will they try and remove it from the Trade Marks Register to secure their registration? If I don’t consent, will the other person use their trade mark anyway, and if so, what is the impact on the distinctiveness of my trade mark etc? Do I need to try and stop them from using their trade mark? If I don’t consent, and I have to issue legal proceedings, what will those proceedings cost? If you receive a request for consent, therefore, consider all the possible ramifications before replying. Work out with (we recommend) the INTELLECTUAL PROPERTY ISSUES > BY BEN CAIN Ben Cain is a Senior Associate at James & Wells and a Resolution Institute-accredited mediator. He can be contacted at 07 928 4470 (Tauranga), 07 957 5660 (Hamilton), and benc@jaws.co.nz. assistance of a trade mark lawyer whether ‘tis indeed nobler in the mind to suffer the slings and arrows of consumer confusion, or to take arms against a sea of potential troubles and, by opposing, end them. Business Defined Technology Join us for Yorb‘s July training seminars. We’ll show you how to get the best out of your Office 365 subscription and will deep dive into Microsoft applications. Additionally stay for lunch and hear why security has become a discussion for the entire business, and how to ensure your businesses can remain safe in the modern cyber frontier. From $149 excl gst Highlights Maximise Office 365 Register today, spaces are limited! Date: Wednesday 17 July 2019 Location: Trinity Wharf, 51 Dive Crescent, Tauranga Morning Session: Think you know Office 365? Lunchtime Session: Security: People, Process, and Technology Afternoon Session: Deep Dive in Office 365 E.g. Master Microsft Teams and more Business Security Tools Master Teams For information and to purchase tickets: www.yorb.tech/training-events
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