10-09-09 edn

Govt defends reforms to approvals

 The state government has defended its approach to reforming the approvals system in the resources sector following a survey identifying Western Australia as a high risk for resources industry investment. Mines and Petroleum Minister Norman Moore (pictured) said improving the existing approvals system was never going to be a "quick fix".

Aussie dollar closes at 12-month high

 The Australian dollar closed Monday at its highest level in over a year as investors sought high yielding assets such as commodity-driven currencies after improving jobs reports. At close, the dollar was trading at US85.20 cents, its highest close to the domestic session since September 1 2008, when it ended at US85.40c.

EY settles $125m Sons of Gwalia claim

 The long-running saga of the Sons of Gwalia collapse has reached another milestone with the former mining company's auditor Ernst & Young agreeing to pay $125 million. If approved by creditors, the sum will add to $3 million to be pwaid by former directors and $50 million agreed to be paid by their insurers.

UWA loses $75m Gray appeal

 Former University of Western Australia researcher Dr Bruce Gray will be able to keep his $75 million stake in Sirtex Medical after the Federal Court dismissed the university's appeal over ownership of the biotech's intellectual property. In a very brief delivery of the judgment, the Supreme Court upheld Justice Robert French's decision, handed down last year, which found no legal foundation for UWA's case.

State to overhaul mine safety system

 The state government will provide nearly $8 million of additional funds and employ a further 72 people to boost WA's Resources Safety Division as the state's mining death toll creeps up. Mines and Petroleum Minister Norman Moore announced it would implement a new regulatory framework for resources safety that will incorporate key recommendations from the Kenner report. The overhaul comes after a 30 year old man was killed at Alcoa's Wagerup refinery last week.

Appointments 24

Murdoch to Karara

Former Austal and Cape senior executive, Steve Murdoch, has been appointed chief operating officer of Karara Mining, the joint venture vehicle responsible for development of Gindalbie Metals' and AnSteel's $1.8 billion Karara iron ore project in the Mid West. Mr Murdoch previously headed UK industrial services group Cape plc's Australian business and is a former chief operating officer of shipbuilder Austal.

Changes at Amadeus

Oil and gas company Amadeus Energy has bowed to demands from disgruntled shareholder CVC, announcing that managing director Geoffrey Towner will step down and two other directors will resign. Amadeus will appoint a new executive chairman once Mr Towner steps down to become a non-executive director while chairman Andrew Peacock and director Caroline Bentley will resign from the board. Director Stephen Pearce will act as interim chairman while CVC chief executive Alexander Beard will be appointed as non-executive director.

Walsh leaving Clough

Engineering and construction outfit Clough announced that, after six years, Andrew Walsh (pictured) has resigned his role of chief financial officer and executive director and will terminate his employment on September 30 2009. With immediate effect, and for an interim period Richard Simons and Neil Siford will split the responsibilities with Mr Simons responsible for finance, treasury and investor relations and Mr Siford responsible for management and statutory accounting.

WildHorse additions

Uranium explorer WildHorse Energy has added Matt Swinney, Mark Hohnen and Ian Middlemas to its board of directors. Mr Hohnen, who is chairman of Namibia-focused uranium stock Kalahari Minerals plc, and Mr Middlemas, chairman of uranium explorer Mantra Resources, along with project management executive Matt Swinney, intend being the key executives of the company.

Directors' Interests 23

The chairman of South Perth-based property developer Finbar Group sold 300,000 shares on-market last week. Paul Rengal received $251,650 from the sale that took place in late August when the company released its 2009 financial year report, revealing a 55 per cent increase in net profit to $18.9 million.

Three directors in Sandfire Resources have spent a collective $1.3 million participating in the company's rights issue. Chairman Miles Kennedy, executive director Karl Simich and non-executive director John Hutton subscribed to more than 1 million shares for a discounted $1.20 each.

More beer moves in the east

West Aussie beer companies have a bit of track record of colonising the east coast, especially the southern climes of Victoria.

The Note is not talking about the kind of empire-building that Bondy attempted by using Swan as a launch pad to takeover Castlemaine and Tooheys.

It's more on the boutique side that we have to take note.

The former Matilda Bay Brewing Co, which invented Redback, was one of the first to migrate its concept east with operations in Melbourne, establishing a microbrewery there in the 1980s. Perhaps that put it on the radar of the big boys, because it was later snapped up by Foster's.

More recently we've seen the success of Little World Brewing, which owns the Little Creatures operation in Freo. It is set to launch a new brewery, called White Rabbit, in regional Victoria, using the old brewing equipment from the Fishermen's Harbour site, which now has a state-of-the-art manufacturing facility.

As an aside, The Note must also mention that big-time brewer Lion Nathan sits comfortably on the Little World register at about 40 per cent.

Perhaps a little further removed was recent news that Palmyra's Gage Roads has won a contract to make home-brand beer for Woolworths after the supermarket giant took a 25 per cent stake in the brewer.

With all this in the background, it is interesting to hear speculation that Margaret River's Colonial Brewing might soon have a sister operation on the Mornington Peninsula. The Note hears that Computershare founder Chris Morris, who bought Colonial off the ailing Empire Brewing group, might be planning the new facility to service a string of pubs he's just acquired.

Credit access thwarts franchises

ACCESS to credit has been the biggest impediment to franchises meeting short-term growth targets during the economic downturn, new PricewaterhouseCoopers research reveals.

PwC's Franchise Sector Indicator, which surveyed 240 franchisors representing 68 franchise systems, found 83 per cent rated availability of credit for incoming franchisees a potential impediment.

Fifteen per cent of franchisors said lack of credit had thwarted their own growth plans.

Franchise Council of Australia executive director Steve Wright said the sector had been growing at 7 to 8 per cent a year for the past decade, and was weathering the downturn better than stand-alone businesses.

"What this survey shows is that the community has been right in identifying the availability of credit, including bank lending policies, as being a major issue for the sector," he said.

PwC partner Greg Hodson said instead of slashing marketing budgets, cutting services or delaying capital expenditure, franchisors had proactively "joined franchisees in the trenches" to weather the storm.

PwC found that most franchises were reducing operating costs (69 per cent) and staffing costs (46 per cent), while maximising cash balances (46 per cent) to cope with a lack of access to credit through the global financial crisis.

L7 eyes off more govt deals

L7 Solutions' new three-year, multi-million dollar contract with the Department of Health for upgrades of rural and remote site infrastructure is just the start of various government opportunities the company has in its sights.

Under the contract, the IT services and solution provider will supply Cisco network infrastructure for the WA Country Health Service.

L7 Solutions chief executive Matt Sullivan said the contract was firmly in-line with his company's continuing focus on the WA market.

"We are ecstatic to be working with the WA Country Health Service on this contract as it's been a long time coming for the upgrading of these remote regional areas," he said.

Initial funding has been made available under the Department of Broadband, Communication and the Digital Economy, Clever Networks (Round 2) Program with matched state government funding designed to enhance innovative health service delivery via broadband technology.

Mr Sullivan said the government would end up spending between $2 million and $3 million in the first year of the contract, with this spend to increase over the term of the contract.

"One of key focuses for us over the last six to 12 months has been driving government work," he said.

"And we're on the cusp of announcing on some other big wins with other government agencies," he said.

Challenge, Harvey Fresh among winners

SOUTH West-based Challenge Australian Dairy, which owns the Capel brand, won two awards at last week's Westpac Food and Beverage industry awards.

The company, which is jointly owned by Challenge Dairy Cooperative and Singaporean food manufacturer QAF Ltd, was the overall winner at the awards organised by the Food Industry Association of WA.

It also won the excellence in supply chain award for its new A2 Milk.

During the past year, Challenge's revenue base has increased from $35 million to about $100 million a year, and the dairy has successfully started exports of fresh dairy ingredients to South-East Asia.

Other winners on the night included Harvest Fresh Cuts Pty for its 'ready to heat' baby potatoes, WR Carpenter won the export category, and IGA for best marketing campaign.

The Village Kitchen won the best food service category, The Chia Company was the innovation category winner, while Alba Edible Oils won the environment and sustainability award.

There were more than 100 entries from almost 50 companies operating in WA, Food Industry Association chief executive Andrea Berteit said.

Essential Office joins Pitney Bowes

BURSWOOD-BASED Essential Office Products has joined global office supplies and solutions company Pitney Bowes Australia as a partner in Western Australia.

Working in conjunction with Pitney Bowes' direct sales team, Essential Office Products will distribute Pitney Bowes' 'mailstream' technologies including postage meters, folding machines, address validation software and addressing printers.

EOP managing director Geoff Frampton told WA Business News the company, which has operated in WA for more than 20 years, would become the exclusive distributing agent for Pitney Bowes in WA.

"Our contacts and experience in office products and solutions will allow us to achieve the sales potential of Pitney Bowes' products in Western Australia, and ensure the best service for all our customers," he said.

EOP joins a global company founded in 1920 that currently employs 36,000 staff and delivers its technology and services to 2 million customers worldwide, generating annual revenue totalling more than $6 billion.

Pitney Bowes managing director Tony Simonsen said the partnership would allow the company to gain a stronger foothold in the WA market.

"Essential Office Products are experts in their field of office products and solutions and are the perfect choice for a channel partner in WA, ensuring our customers will get the best advice and service when choosing mailstream solutions," he said in a statement.

Any complaints?

AS a manager, you will have to handle complaints. Sometimes you can take action that will resolve the complaint - at other times listening to the complaint is all you can do.

The important thing is that people feel they can bring their reasonable complaints to you.

Untreated complaints can fester and turn into bigger problems, so it is in your interests to welcome complaints as an opportunity to improve a situation before it gets out of hand.

Under exploration and explanation, many complaints disappear because they were based on an inaccurate perception or ignorance of the facts or of the broader context.

Things will happen in the workplace that will cause your people to complain. As time consuming as it may be, would you rather they bring their complaints to you or take them to others who may only inflame the situation?

You need to hear complaints to deal with them. Establish a climate in which the person feels free to discuss the complaint without fear of repercussions or reprisals. To develop the right climate, you need to do two things.

Listen with empathy, even when you disagree.

Maintain the other person's self-esteem. Allow them to 'save face'.

When a person complains, he or she wants you to hear what is unfair in their eyes. Respond (not react) in a way that indicates that you can see what it is like for them in their world as they see it. Show you understand what the person is saying and how they are feeling.

A person's self-esteem is very important to them. The person may be calm or very agitated or very angry. Ignore the latter behaviour even if you don't like it and focus only on the complaint and that, rightly or wrongly, it is important to the person. No matter how trivial it may seem to you. Any response from you that trivialises the complaint tends to lower the person's self-esteem or embarrasses them. Handling complaints successfully needs skill and patience on your part.

Follow these guidelines.

- Listen to the person with your full attention using paraphrasing and probing techniques.

- Get all the details - take notes. Let them speak without interrupting except to encourage them to elaborate. Let them get it off their chest. This will make them feel much better and more open to reason.

- Describe their situation in your own words. Show empathy by describing how you would feel in a similar situation. Check that your interpretation of the situation is correct.

- Ask what they would like to see happen? Ask how that would affect all other people?

- Openly put your position. Provide them with information or perspectives that they may not be aware of. Explain to them the connections between things.

- Discuss what you can and cannot do and explain why.

- Decide and agree on specific follow-up action. Agree what you will do and what they will do.

- Acknowledge the person's complaint and thank them for bringing it to your attention.

If there is no basis for the complaint, explain your response, make a note to that affect, both of you sign it and invite them to take their complaint to a higher level with a copy of your response.

How good are you?

HOW good are you, really?

Be your own customer, and find out, really.

Yesterday, I got the shock of my life - I tried to buy something on my own website and couldn't.

Funny, I buy all kinds of things on other people's websites. I'm a one-click buyer on Amazon. I have my credit card registered and saved on every site that will allow it. In short, I trust the internet.

In short, short - if I decide that I want to buy something online, I want to buy it fast. And I don't know about you, but I'm not crazy about filling out an online order form (where all the boxes say it's "mandatory" to enter my information.)

Many of you subscribe to my weekly email magazine and have taken advantage of the "deal of the week", a special offer on a bundle of my books and CDs. Last week we decided to present something for the first time - a $20 discount off any of my upcoming public seminar tickets. Fair enough.

So I went to my own site to test the offer. I put in a request to buy five tickets. The website (my website) promised fast and easy purchase. And that promise was anything= but the truth. It was a pain in the butt. I clicked off of my own site in frustration and disgust.

I immediately pulled the offer and we went through an e-commerce exercise that brought me back to reality. We revamped the purchasing process to where it is fast and easy, and easy to understand. It's now fixed for the short term, and we have a long-term plan in place (actually in motion) to make it even faster and easier.

Major clue: Had I not tried to buy something from my own website, I would have never known. I would have danced along actually believing my own words, never realising that customers were frustrated - and worse - not buying. Clicking off - abandoning the next step in the buying process because it was slow, cumbersome, and uninformative.

How's yours? Think your e-commerce is great? Ever try to buy something from yourself?

Challenge: Be your own customer at least once a month.

In these trying times, many customers (yours and mine) are struggling to maintain volume, profit, and productivity. Somehow the stimulus package and bailout have not yet reached them; me either. You?

Reality: Each of us is responsible to stimulate and bail out ourselves, in spite of what you may be hearing.

If and when your customer calls or goes online, they expect instant answers, instant service, and instant delivery of whatever they need - or they will seek a competitor.

And they expect multiple options to connect with you, any time of the day or night, to get the help they need, or buy the product they need.

Reality: Their need is your opportunity. Your challenge is to turn them into a happy, loyal customer who is willing to repeat purchase, tell others, and refer others to you.

Not "satisfy" them.

Here's what to do to self-insure your own success.

- Call your business five minutes before you open, and try to place an order, or get service.

- Call your business five minutes after you close, and try to place an order, or get service. (That should be enough to make you angry - but wait there's more.)

- Go online and try to buy something. How long does it take (how many clicks?) compared to Amazon's one?

- Call your business during the day and complain to someone. Then ask for the person's boss - or even your CEO. Make certain you have plenty of Pepto-Bismol on hand - because I promise your stomach will be turning upside-down.

- Now call yourself and listen to your pathetic voicemail that tells me everything I do not want to hear, and does not tell me the one thing I want to hear - where the heck are you?

Reality: Whatever your experience is when you call yourself or buy from yourself online, that's the same thing your customers, your life-blood, and your money-line is experiencing.

Fix it fast. Your customers need you.

If you want an idea to eliminate the silly computer that answers your phone before and after hours telling me "how important my call is," go to www.gitomer.com and enter the words ANSWER LIVE in the GitBit box.