NOW ITS TIME TO HEAR FROM THE WORDWIDE LEADER ON THE AUSTRALIAN RESEARCH AND DEVELOPMENT TAX CREDIT AND WHAT IT MEANS TO YOU!

Paradigm Partners International in conjunction with Expense Reduction Analysts is proud to present:

“MAXIMIZING THE 2010/2011 CONCESSION IN PREPARATION FOR THE 2011/2012 CREDIT”

This free informational seminar will include topics such as:

• Engineering the Australian Research and Development Tax Credit
• Current Tax Law and its effects on your organization and the Credit
• Calculations and Documentation of the Credit
• Audit Defense when Applications are reviewed

And much more:

Please mark your calendars to attend!

PERTH

Date: Tuesday, 21st February 2012
Time: 7:30 –9:00
Venue: University Club of WA, Hackett Drive, Perth

MELBOURNE

Date: Thursday, 23rd February 2012
Time: 7:00 –9:00
Venue: Oaks on Collins, Oaks Room, 480 Collins Street, Melbourne

SYDNEY

Date: Friday, 24th February 2012
Time: 7:00 –9:00
Venue: Marriot Hotel, Oxford Room, 36 College Street, Sydney 2010

BRISBANE

Date: Thursday, 1st March 2012
Time: 7:00 –9:00
Venue: The Brisbane Club, Oaks Room, 41 Adelaide Street, Brisbane

A continental breakfast will also be served

Please RSVP your name to Lea Fenton at lfenton@expensereduction.com or 02 8014 8852.

This is arguably one of the most pivotal years in Australian History for Manufacturers, Fabricators, Engineers, and other types of Research institutions. Do not let misinformation cause your company to miss this exciting opportunity!

Reviewing your waste costs can be very time consuming and involves:

-          Knowledge of the waste industry sector

-          An understanding of market conditions

-          The ability to unravel complex contract terms

-          A detailed knowledge of alternative solutions

-          The ability to understand, evaluate and compare different pricing models

-          Maximising recycling opportunities

-          Picking a strategy that is understandable to waste suppliers and encourages the best possible pricing.

Yes, it’s a long list but that’s the expertise we bring!

Waste is an area that is quickly changing. New ideas and very advanced technological solutions are emerging constantly to aid in recycling and prevent greater environmental damage. We at Expense Reduction Analysts ensure that our clients not only save money but also that they become more environmentally friendly and more aware of the environment – often an environmentally friendly solution can yield even greater savings.

Earlier we touched on some areas that we believe are crucial in reviewing waste costs. The way contracts are worded and the pricing mechanisms used can become a minefield when trying to compare like for like. One client can often have pricing models for waste that vary from cost per bin, cost per m³, cost per tonne or a set monthly/weekly fee for a scheduled service which could be more than once per week. Our job is to untangle these many different pricing models to enable you the client to have a clear understanding of what you are paying for and what the service is actually costing you.

We look to understand what your real requirements are and how these are currently being met. We then look at introducing more environmentally friendly solutions which again can have significant financial benefits. We continually monitor both the service being provided and the charges levied and this means we frequently uncover significant levels of over-charging and seek credits accordingly.

We are also constantly reviewing new industry developments and ways in which they can benefit you. Expense Reduction Analysts deal with these issues day in and day out and it’s only through our knowledge and expertise that we are able to identify where potential pitfalls lie and where there may be improvement opportunities.

There is even more complexity in the world of clinical waste which deals with Hazardous, Infectious and Offensive Waste.

All of these waste streams have very strict procedures for disposal which must be adhered to and the charging mechanisms used by suppliers can make it very difficult to actually compare like for like. Even as experts we find we must often evaluate 12 months worth of data before we can accurately analyse expenditure in clinical waste.

The recent work we have done in the aged care and heavy engineering industries has yielded savings in region of 38% and needless to say we have some delighted clients.

Our consultants are members of the Waste Management Association of Australia and are able to stay abreast of the latest technology and legislation allowing us to continually identify alternative cost saving and recycling solutions for the clients we help. This is a cost area our clients can leave us to manage allowing them to focus on the more strategic issues that they face in these challenging times.

Peter Landon

plandon@expensereduction.com

The figures now show an economic slowdown in China and if this is mixed with a poor retail result over Christmas along with the introduction of the new carbon tax impact,  then 2012 is going to be a really challenging one for many businesses – and most likely tougher than the original GFC and all its effects..

Business is facing extremely tough conditions and it is irrelevant if we fall into recession. The banks claim at the customer level that finance is available for lending, but at the macro level it seems finance is becoming tight and credit rationing is likely to occur again putting stresses on the business.

Now is not the time to take the attitude of ‘bunkering down”.

The tough times are opportunities and the time to be doing something that makes you stand out from the crowd. It is the time to show that point of difference and the value addition, so you can continue to source capital to fund and grow the business.

We are going to see the headlines for panic and cost cutting, downsizing and laying off staff like the herd always does. The press will run the doom and gloom and it is almost self perpetuating.

In these times the winners will be those tightly managing their working capital, continuing with research/development and innovation, showcasing their “demonstrable” unique selling proposition and standing out from the crowd.

When credit is hard to access these are the businesses that will win the competition for scarce funding.

How to survive the economic downturn

1. Price
   A strategy of competing just on price when things are tough is difficult. Know the market and take when possible. With discounting you don’t know your competitors’ cash reserves and attempts to go down this track are fraught with danger not knowing if you can outlast your competitor.

2. Point of Difference
   Be unique and have a real Point of Difference you can demonstrate and support. Keep the focus on innovation through the economic downturn. When this recession ends (and it will) – the business still discounting its old products will be in trouble compared to the one introducing new products at a higher margin to the market.

3. Cash
   Aggressively manage accounts receivable, inventory and payables and seriously consider selling non-core assets/divisions or surplus assets. Seriously consider sale and leaseback options for property and other assets to bolster cash flow. Examine the noncore spending in the business such as communications, office supplies, travel cleaning, waste, but get it done for you while you concentrate on the business.

4. Competition
   Who are the competition and is it a time to consider a merger in order to not only survive but come through the next period in better shape than your competitors.

5. Costs
   Focus right now on stress testing your business. What can it survive, what would happen if credit was cut or a major client crashed? Review the costs in the business and make sure they are market competitive

In 2011 ASIC indicate we are on track for more than 15,000 companies to become insolvent (based on FY2011 ASIC stats of 14,566), a significant number could have been saved if they had sought the right help early enough.

The world they say is a faster place, but the current economic downturn has dramatically increased the speed at which business conditions change.

Astute leaders rely more than ever on risk management strategies to protect their businesses.

It is now essential to be undertaking detailed financial modelling and “what if” scenario testing to gauge how sudden changes in market conditions will affect your business – and more importantly, what initiatives management can deploy to combat these challenges? Now is the time to get your noncore costs reviewed to maintain your market competiveness for the future. A saving here may be the cash needed to fund the innovation or Research and development for the Point of Difference (and do not forget the new R&D tax incentives)

So what is your business doing to stand out from the crowd in 2012? We’d love to hear.

Tom Debney
Principal Consultant
Expense Reduction Analysts 
M 0417 568 423
tdebney@expensereduction.com

What they may not realise, is how often corporate travel programs are inefficiently managed, and more importantly, how much money is being wasted.

Corporate Travel Management (CTM) managing director Jamie Pherous told Dynamic Business that the amount of un-tapped savings can even run into the millions.

“We often find shocking amounts of potential savings just sitting at the fingertips of new clients.”

According to Pherous, CTM focuses on returning on a business’ investment, which means its able to find significant numbers of lost savings when inducting new clients.

“These savings are ripe for the picking, but have previously gone un-tapped by ill-managed and inefficient travel programs.”

“So shocked have we been at the amounts being lost we compiled a case study dossier demonstrating how we have been able to drive massive cost reductions through carefully designed and implemented travel programs to try and encourage discussion around this important issue.

In three cases addressed in the document, Pherous said CTM’s been able to:

• Reduce the travel spend of a company of the resources sector by $5.4 million despite substantial increases in their number of sectors booked, by changing their booking behaviour and increasing their policy compliance.
• Decrease the travel spend of a construction company by 21 percent by managing booking behaviours and trends, seeing more than $100,000 in travel savings achieved despite a 10 percent increase in travel activity.
• Save an electronics retailer $1.8 million through a consolidated approach to the negotiation of direct supply agreements.

“We want people to start asking the hard questions of their travel provider – it is quite possible that complacent management could be seeing them lose millions?”

This article originally published in Dynamic Business Magazine, Nov 2011

According to SplashData, the top two most used passwords of the year are ‘password’ and ‘123456’ – so if you’re guilty of these poorly chosen security measures whether on personal or business accounts, now is the time to change them. Other common passwords include popular names like ‘ashley’ and ‘michael,’ and patterns based on the layout of the keyboard like ‘qwerty’ and ‘qazwsx.’ There are also some mysterious choices, like the unusual popularity of ‘monkey’ and ‘shadow.’ As more sites begin to require more complex passwords, letter and number combinations like ‘abc123’ and ‘trustno1’ are also being used more often.

In an effort to encourage adoption of stronger passwords,SplashData has released its 25 Worst Passwords of the Year list for 2011, which was compiled from files containing millions of stolen passwords posted online by hackers.

And the most common passwords on the web are:

• password
• 123456
• 12345678
• qwerty
• abc123
• monkey
• 1234567
• letmein
• trustno1
• dragon
• baseball
• 111111
• iloveyou
• master
• sunshine
• ashley
• bailey
• passw0rd
• shadow
• 123123
• 654321
• superman
• qazwsx
• michael
• football

According to SplashData CEO Morgan Slain, any business or consumer using any of the passwords on the list, should change them immediately.

“Hackers can easily break into many accounts just by repeatedly trying common passwords. Even though people are encouraged to select secure, strong passwords, many people continue to choose weak, easy-to-guess ones, placing themselves at risk from fraud and identity theft.”  Although thieves have more sophisticated hacking tools at their disposal than ever before, they still prefer easy targets. Slain suggests that just a little “more sophistication in choosing passwords will go a long way toward making you safer online.”

SplashData suggests making passwords more secure with these tips:

• Use passwords of eight characters or more with mixed types of characters. One way to create longer, more secure passwords that are easy to remember is to use short words with spaces or other characters separating them. For example, ‘eat cake at 8!’ or ‘car_park_city?’
• Avoid using the same username/password combination for multiple websites. Especially risky is using the same password for entertainment sites that you do for online email, social networking, and financial services. Use different passwords for each new website or service you sign up for.
• Having trouble remembering all those different passwords? Try using a password manager application that organizes and protects passwords and can automatically log you into websites.

This article was originally published in the Dynamic Business Magazine, Nov 2011

Who is Responsible?

The new National Transport Commission Legislation is clear. All parties in the supply chain who manage or influence elements of the supply chain, have responsibilities to prevent driver fatigue and ensure drivers can comply with the legal work/rest hours. If your actions, inactions or demands cause or contribute to road safety breaches then you can be legally accountable. Authorities will investigate the supply chain and up and down the corporate chain of command. The days of ‘all care and no responsibility’ are over.

Drivers and operators have traditionally been the focus of heavy vehicle transport legislation breaches. However, with recent and further legislative changes planned, all parties in the transport chain have a clear responsibility to ensure road safety and legislation requirements are not compromised. This is called the chain of responsibility. Parties included in the chain of responsibility include any person or party who influences the transport task, such as:

• Consignors, those who commission the carriage of a load by road
• Packers, those who place goods in packages, containers or on pallets transported by road
• Loaders, those who place or restrain the load on a heavy vehicle
• Drivers,  those who physically drive a heavy vehicle
• Operators and Schedulers, those who operate the business that controls the use of a heavy vehicle
• Receivers,  those who pay for the goods or take possession of the load
• Employers or Managers of a business may also be personally liable for breaches by an employee.

If your actions, inactions or demands cause or contribute to road safety breaches then you can be held legally accountable. Transport Inspectors and Police Officers can investigate along the transport chain and up and down the corporate chain of command.

The law requires you to take all reasonable steps to prevent your actions or conduct from causing or contributing to a breach. In addition, the law also prohibits you from:

• making demands that you know or ought to know would cause a breach
• coercing, inducing or encouraging breaches
• passing on false or misleading information that could cause a breach.

You should ensure that you can demonstrate you did not know and could not have been reasonably expected to know that a breach in the road law occurred and that either:

• you had taken all reasonable steps to prevent the breach
• there was nothing you could reasonably have done to prevent the breach.

There are no limits to the ways in which you can do this. What constitutes reasonable steps will vary according to each individual’s circumstances. You may need to change the way you do business. Taking reasonable steps could include:

• reviewing your business practices
• developing an industry code of practice
• adopting a risk management approach
• using accreditation schemes
• changing your commercial arrangements.

Business practices

You should regularly review your business practices to ensure that at all times the steps you are taking are reasonable. Some of the steps you may need to consider include:

• ensuring your work practices do not contribute to or cause on-road breaches
• training for staff to ensure they understand their obligations under chain of responsibility
• completing audits or spot-checks to ensure compliance (for example, monitoring of loading)
• putting in place contingency plans to manage operational issues within the law.

Commercial arrangements

You can ensure your commercial relationships do not cause your business to breach chain of responsibility laws by:

• including best work practices (for example, safety accreditation) in relevant commercial arrangements with other responsible people or parties in the transport chain
• requesting information about what systems and controls are in place to ensure compliance (for example, policies on drugs or fatigue management)
• avoiding arrangements which encourage or reward non-compliance.

Legal advice

For specific queries about chain of responsibility legislation applicable to you, consult a solicitor or the Legal Aid organisation in your state or territory.

Source: Queensland Government

For example, why is it that so many customers feel entitled to pay their invoices so casually late? Don’t get me wrong, I understand that the accounts departments of businesses are dark and mysterious places, but when freight and logistics services are so delicately time-sensitive and so crucial to the day-to-day operation of client businesses, it is particularly galling to be still waiting on payment two or three months later.

Similarly, why is it that clients hold companies into contracts that forbid the service of competitors, when that loyalty is not reciprocated? It seems perfectly legitimate for customers to dangle the threat of cancelling contracts; to hold providers to ransom against rival logistics companies, while issuing strenuous warnings against similar practices from the provider’s perspective.

Both examples of this “double standard” are becoming increasingly prevalent in the industry, and seriously undermine the establishment of the long-term customer relationships that logistics services pride themselves upon.  Obviously, everyone understands that a client will always want the best deal – that’s just good business practice – but there is also a distinct difference between negotiating a competitive price and pricing solely against competitors. The latter option is potentially damaging to the industry as a whole, as it leads firms into squeezing their margins to nigh-on unreasonable levels.

If this is also combined with a client who is not experienced in regards to the general costs of logistics and freight forwarding services, this can force companies into an impossible and untenable position. With the fragile economic conditions of the market, we all know it is vital to stay on good terms with clients, and no-one wants to turn down business, but seriously underpaid contracts only really lead to seriously underpowered service. Despite a company’s best intentions, the financial shortfall from such contracts has to be made up somewhere and the likelihood is that it will probably diminish the overall quality of the service.

This vicious cycle is patently bad for the industry as a whole. While companies must maintain their integrity, customers must also hold up their end of the deal by resisting the urge to exploit a recession hit market to unfeasible extremes. We want clients to have high expectations, but they need to be based in the practical realities of logistics. Ultimately, fair payment begets good service. As the industry strengthens then maybe we will see some clients being asked to re-bid their business to the market as logistics companies see no value in doing business with them anymore. Maybe the industry should have the strength today?”