Worm turns on branch economy

A few years back we ran a piece on Western Australia becoming a branch economy, reflecting on the loss of major businesses and brands in sell-outs to national firms.

About a year later we predicted this trend may have ended for the time being, mainly due to the lack of things left to sell and partly because a few businesses had actually returned to WA hands – Red Rooster being one of them, from memory.

The cover image was one of coastal mudflats, with a headline suggesting the tide had turned.

Of course, tides come and go, and can peak higher at times due to all manner of weather and lunar conditions.

With the mining boom taking place it seems that the tide has returned, this time sweeping away local ownership in the mining services sector where several WA businesses had become global players.

I could spend the next few paragraphs bemoaning their disappearance, but I won’t.

While I, like many, would like to see such operations remain in the hands of people based here, I have to acknowledge that successful people have to have an exit strategy and will want the highest price possible for their hard work.

It seems that, often, that price comes from somewhere else.

What remains important is that whoever owns these businesses continues to invest in WA and grow those businesses, especially when it comes to having decision-makers on the ground and for spending in R&D, so that talented people can still find jobs here.

It is also important for us to foster an environment where new businesses – both in existing and completely new mining services-related fields – can grow and make life easier for the resources sector, with its numerous local players who operate around the globe.

It still remains important for home-grown companies to exist.

If and when a downturn occurs, home-grown companies tend to act differently because the decision makers are, inevitably, based here.

That means they fight harder to keep things going, rather than the possibility of an axing decision being made from 5,000 or even 15,000 kilometres away.

Has taxi ‘reality’ been exposed?

I am reliably informed that Perth was featured on a recent episode of reality TV show, The Amazing Race.

While I have no idea how much of a role tourism authorities or others in government had in getting such a show filmed here, my informant tells me that the show did expose one big, glaring weakness of Perth for locals and travellers alike.

The problem was, I am told, the show’s contestants – who race against each other in teams to collect points like some global car rally, minus the cars – proved just how hard it is to get a taxi in this city.

From Barrack Square to Fremantle, it seems that our system just can’t guarantee a taxi when you need one, even if you booked it.

This has long been an issue of concern to me.

I don’t blame taxi drivers. I blame a system whereby drivers are the meat in the sandwich between consumers who want taxis and plate owners who want an income to justify the price they’ve paid for the plates.

If we took away the need to pay huge amounts for plate licences and removed restrictions on the number of taxis allowed on our streets, I reckon taxi drivers would make more money, thereby encouraging more people into the industry.

In fact, we may even have cheaper taxi fares, more taxis, and taxi drivers making more money.

That would make a heap of sense, rather than having taxi plates being considered an asset class protected from competition by governments.

Why do we need a layer of private ownership in the taxi system?

Plates only have value because they are over-regulated and there are not enough of them.

It really is time for the state government to bite the bullet on this one and find a fair way of buying out the owners of these plates and freeing up the market so Perth can have as many taxis as it needs, rather than a number cooked up by bureaucrats under pressure from investors.

It might be a little less embarrassing for all of us the next time the world’s cameras descend upon our neck of the woods.

Benchmarking

In the world of regional business publications there is not really anyone in Australia who does it like we do here at WA Business News, so we seek to benchmark ourselves against places in the world where more newspapers like ours exist.

In North America, there’s a paper or magazine doing what we do in almost every city. We look at the most successful when we want to compare ourselves, which is why awards are important and why we are always excited to get recognition from judges who know our space well.