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business & Leisure: Frankston | Mornington Peninsula | Dandenong

MARCH 2012 | $4.95 (GST inc.)

Stopping

The Rot

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LOWER TAXES ARE THE KEY TO SUPER’S FUTURE SUCCESS

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Departments News Busy Bites Networking Corporate Travel Self managed super Business Directory

ISSUE 21 / MARCH 2012

4 6 8-9 13 14 23

Columns Health: Mike Ellis Markets: Richard Campbell Managing: Hamish Petrie Planning: Megan Schutz

business & LeisuRe: Frankston | Mornington Peninsula | Dandenong

MARCH 2012 | $4.95 (GST inc.)

Stopping

The Rot

INTERNATIONAL SOCIAL GOALS FOR SCIENTIST TURNED BUSINESSMAN

BOYS TOYS

LOwER TAXES ARE ThE KEy TO SUPER’S FUTURE SUCCESS

whEN IT COMES TO GETTING AwAy, A DAy ON ThE BAy wILL DO IT

Superior service through integrity • Professional, Caring, Victoria Police-licensed • Operating out of Frankston since 2002 • Owner-operator ex Victoria Police Contact Allan Hamilton for personal service on 0418 396 321 email allan@corporateshadows.com.au Office Suite 12A Brockwood House, 424-426 Nepean Hwy, Frankston 3199, Freecall national number 1300 720 800 Correspondence PO Box 9076, Seaford MDC Victoria 3198 (VPPSBL No. 643-122-205)

pLANNiNG PROPERTy DEVELOPMENT hAS ITS REwARDS ... AND SOME PITFALLS, TOO

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COVER: Chris McEvoy is an entrepreneurial scientist. Once carrying out research for the CSIRO, he now runs a business based on preserving timber while helping out villagers in southern Africa : SEE P.10

FRANKSTON / MORNINGTON PENINSULA / DANDENONG

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TONY MURRELL KEITH PLATT MARG HARRISON DAVID HILET MELANIE LARKE SIMON BROWN Design MARLON PLATT

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CHRIS SELBY’S HOUSE WITHIN A SHOP – P12

Features

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STOPPING THE ROT: A research scientist turns entrepreneur

TOYS FOR THE BOYS: The next best things to walking on water.

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Are you in BusinessTimes? For advertising, contact Marg Harrison on 0414 773 153 or marg@businesstimes.net.au Make sure every business knows your business. DISCLAIMER: Information in BusinessTimes contains general advice only. No article or column has been prepared taking into account any individual reader’s financial situation, investment objectives or particular needs. Readers should personally consult professionals for advice on any matter, including investment, health and the law. While all care is taken, BusinessTimes accepts no responsibility for errors or omissions in the published material. Views expressed are not necessarily those of BusinessTimes Pty Ltd. All content is copyright.

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Cheers, in Latin style WHEN Crittendens Winery jumped at the opportunity to work with Frankston Arts Centre neither party knew that the relationship would bring together Spanish wine styles and festivals of Spain, Portugal and Latin America. Brother and sister team Rollo and Zoe Crittenden were delighted to show off their Los Hermanos (the siblings) at the Ventana Fiesta opening night at the arts centre’s Cube 37 on 2 March. Crittendens have agreed that their family’s wines will be showcased at all Cube 37’s special opening nights throughout 2012. The wine poured at Ventana Fiesta’s opening night was the Los Hermanos 2010 Tributo. And here is another link between the wine and the fiesta’s association with the famous pilgrim walk “El Camino de Santiago”. When Crittendens first planted the vines at Dromana they believed they

were in fact planting Albarino, the style grown in Galicia in Spain that had initially grabbed Rollo’s attention. Years later, however, it was found that the initial cuttings of Albarino brought to Australia from Spain were in fact not Albarino but a variety called Savagnin; though obviously rather similar. It is thought that the mistake dates back hundreds of years to when French monks most likely transported Savagnin to the Galicia region as part of their patrimony on “El Camino”. It was Rollo’s idea to first name the wine Tributo a Galicia (Tribute to Galicia - now shortened to Tributo) which of course is fitting for the Ventana Fiesta because Santiago in Spain is the principal town of the Galicia region and finishing point of “El Camino” In 2010 Rollo won Australian Young Gun Winemaker of the Year and judges

Brother and sister winemakers Zoe and Rollo Crittenden. Crittenden’s wines will be served at special opening nights at Frankston Arts Centre’s Cube 37 this year.

described the Los Hermanos 2009 Homenaje a Cataluna as innovative and food friendly – with groovy labels to match. The festival culminates with a street fiesta in Frankston on 17 March.

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NEWS digest

SHIP LOSS BLOW TO WORKERS

BlueScope Steel’s decision to terminate the services of its steel carrier Iron Monarch later this year was “another kick in the guts” for Port Kembla and Western Port maritime workers, according to a unionist. BlueScope said that from later this year, the company would transport about 650,000 tonnes per year of hot rolled coil feed for the Western Port production lines from Port Kembla via rail. The company also said the Iron Monarch would be sold. Maritime Union of Australia (MUA) SNSW Branch Secretary Garry Keane said the company’s decision would mean around 60 additional job losses in seafaring and stevedoring at Port Kembla, following on from the 130 jobs lost as a result of the company’s restructure last year. “The MUA believes there are ways to keep the operation running. We don’t understand why Bluescope is scrapping a vessel on which they have just spent $17 million,” Mr Keane said.

NICHOL S P R O P E R T Y

MUA Victorian Branch Secretary Kevin Bracken said 40 jobs were in jeopardy at Western Port, following on from the 200 jobs lost through the restructure. “It’s a real kick in the guts to our workforce. Jobs are hard to come by at the moment and this makes a bad situation worse,” Mr Bracken said. MUA National Secretary Paddy Crumlin said the union was in a discussion with key ship-owners and woulD talk to the government about ways the Iron Monarch could be retained in service in some new capacity to service Australian shipping requirements.

harbour plan sinks

MORNINGTON Peninsula Shire Council has abandoned Planning Scheme Amendment C107 effectively killing off controversial works in Mornington Harbour. However, the shire has ordered a further report outlining a fresh planning process to define policy and guide development of the harbour, this time involving all users from

the outset. The failed redevelopment was proposed by Mornington Boat Harbour Limited (MBHL), a wholly owned subsidiary of Mornington Yacht Club. The main elements of the plan were two wave screens, 170 floating marina pens and a travel lift to replace the slipway. The pier wave screen was to be part of the pier’s current reconstruction but has not yet been funded. The 210 m. harbour wave screen was to be located to the east of the pier along the seven-metre contour. Council will ask the state government to complete the pier reconstruction works “as an important element of community infrastructure”. The redevelopment has been subject to extensive council and community debate, an independent panel inquiry and a ministerial environmental effects statement. The proposal attracted more than 2000 public submissions that were split about 50-50 for and against. Both the panel and ministerial ESS supported the harbour’s transformation.

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COMMERCIAL/INDUSTRIAL PROPERTY MANAGEMENT IS A LEGAL MINEFIELD For instance – If the Rates, Insurance or Body Corporate accounts are not sent direct to the Tenant, you must add and collect the GST with a tax invoice and remit it. Under the Retail Leases Act if you did not give your incoming Tenant a Disclosure Statement and a copy of the Lease at least 7 days before they signed, they can withhold rent and cancel the Lease under certain circumstances. You must give a new Tenant at least 5 years guaranteed tenancy. The Landlord must notify the Tenant of their right to exercise an option. The Landlord must give the Tenant an estimate of outgoings before they enter into a Lease and an Annual Reconciliation. If you have not had the property inspected annually and kept the log book up to date, under Essential Service requirements you can be up for substantial fines. If a tenancy comes under the Retail Leases Act, you cannot pass Land Tax onto the Tenant. If you employ a trade’s person for repairs or maintenance they should be properly qualified and have Public Liability Insurance. Commercial/Industrial Property Management is a lot more than collecting rent. You need someone who understands rental levels and demand when it comes to rent reviews, an Agent who can find a good new Tenant if it becomes vacant and someone who can get you the best price if you decide to sell. The same criteria apply to Residential, that’s why we don’t do it. It is horses for courses and the safest thing you can do is to look for an Agent with a dedicated, reliable, professional, Commercial/Industrial

Property Management Department. That’s where we come in. Our Principals, Michael Crowder and Richard Wraith have been in Commercial Real Estate for more than 25 years. Our Property Manager Robert Chappell is a long time Property Professional having worked in Retail, Commercial and Industrial Property since the early 1980’s and specialising in Commercial/Industrial Property Management with large city firms before joining us 5 years ago. Your Investment Property is too important to be treated lightly. Consult the experts and let us give you an obligation free “Health Check” of your property. We will analyse your Lease, check Insurance Cover and Compliance with the various Acts. Then you can rest easily. Contact Michael or Geoffrey Crowder on 9775 1535 if you would like to catch up for a chat.

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March 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 5


BUSY bites

Dusty problem FRANKSTON City councillor Kris Bolam wants Peninsula Link builder AbiGroup to act on complaints of dust and noise by residents bordering the road construction. Cr Bolam also asked council to raise with AbiGroup concerns that the operation of heavy machinery near homes may be causing structural damage. In early Februry AbiGroup said that dust suppression has been a key focus and regular dust suppression programs and measures were in place to minimise dust problems. AbiGroup said concerns from the community could be directed to its 24-hour community line on 1300 453 035.

Call for bus changes MORE than 1000 Hastings district residents have signed a petition requesting the redirection of bus routes to include Hastings Community Health, Maternal and Child Health, Western Port Community Support and Hastings Community House, Western Port Secondary College, a neighbouring retirement village and new housing estates along High Street, Hastings. Mornington Peninsula Shire said it continues to ask the state government for changes to the 782 and 783 bus routes.

Fall in Victorians’ financial wellbeing Victorian households experienced a significant fall in financial wellbeing in the final quarter of 2011. Over One in three (36 per cent) say their finances deteriorated in 2011, and 77 per cent blame increases in the cost of household essentials. The latest ING Direct Financial Wellbeing Index reveals Victorians are indeed falling behind financially. In 2011 only 27 per cent of Victorians gained ground with their personal finances – 36 per cent fell behind, and one in four (25 per cent) expect their personal finances to deteriorate further in 2012. Key findings for Q4 of 2011 (surveyed in January 2012) ‘Victorian households reported the nation’s lowest “comfort” ratings across five key indicators including comfort with long term debt, savings, ability to pay bills, income and investments. More than a third of Victorians (36 per cent) said their personal finances took a backward step in 2011 – a figure that rises to 59 per cent of low income earners. Key factors were reduced employment income

WORK IN STORE FOR RETAIL CENTRES

ECONOMIC analysis studies show that Springvale is Greater Dandenong’s second largest activity centre with a considerable retail offer, particularly around Asian food retailing. Noble Park, by comparison, operates at a lower order and is focused primarily on convenience retailing. The Springvale and Noble Park Retail and Office Economic Analysis studies found that both activity centres are in a highly competitive retail environment and will need to expand their retail offer to maintain market share in the coming decade. Springvale must focus on improving connections to and within the centre, leveraging the competitive advantage of the Asian food precinct and diversifying

(58 per cent) and rising living costs (55 per cent). Higher taxes/levies and rising living costs are the chief financial concerns for 2012 cited by 32 per cent of Victorians, followed by fears of job losses (20 per cent).

the retail offer to capture a greater market share. Noble Park must promote its centre as a streetbased convenience centre, protecting and supporting existing anchor tenants and improving activities between the nodes along Douglas Street (Coles and the railway station) The retail sector in Springvale is estimated to generate total sales of about $211m, about $5295/sqm, below average against other similar sized centres. The retail sector of Noble Park generates an estimated $67m of total sales, with an average trading performance of $4925/sqm, also at the lower end of typical trading levels for centres of this type in metro Melbourne. One of the reasons is the centre’s small residential catchment area.

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6 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | March 2012


KODAK’S NEGATIVE MOVE

JUST like a businessman who ignored computers and bought a typewriter company, Eastman Kodak failed to see the value of digital cameras. The company is credited with inventing the digital camera in 1975, but decided to bury the idea in its corporate backyard to protect film. Whoops. Digital’s effect on film has been the equivalent of letting light in the back of a camera. Film, for most intents and purposes, has been rendered useless. The decision to keep digital under wraps merely delayed the inevitable. Digital images may seem inferior to aficionados, but computer programs are now being used to reproduce every aspect of film, even scratches on a neg. Even digital cameras are facing opposition from computers and mobile phones. Who wants to carry a camera when they can hide a phone? Meanwhile, in the United States, Eastman Kodak has filed for chapter 11-bankruptcy protection, giving it another shot at survival. The company moved out of Australia years ago, despite millions of dollars in government assistance.

Police numbers query

VICTORIA Police command is being asked to confirm police numbers in Frankston’s local government area as well as getting a wish list from Frankston City Council. Cr Kris Bolam has requested a letter to Victorian Chief Commissioner Ken Lay seeking confirmation of police numbers, taking into account 35 officers committed by former Chief Commissioner Simon Overland early last year and another 35 committed by Mr Lay last November. Cr Bolam also requested the rankings of the extra police officers. Council’s wish list includes more police presence on foreshores during summer and rapid deployment of protective service officers to Frankston, Kananook and Seaford railway stations. • Council also will write to deputy premier and Police and Emergency Services Minister Peter Ryan sup-

porting a new police station in Langwarrin. Hastings MLA Neale Burgess promised the station before the last state elections. Council requests funding for the station in the next state budget.

CHARITY LINKS

AN ONLINE directory has been launched to link Australia’s 60,000 charity and not-for-profit organisations. Adelaide based Connecting Up - also a not-forprofit – can connect the organisations with legislators, companies, potential financiers and each other. “This website will provide the opportunity to contribute content, connect with other organisations and access resources that build the capacity of these community-based organisations that are striving to make our community a better place,” Connecting Up CEO Doug Jacquier said. The service has been praised by Wolrd Vision CEO the 
Reverend Tim Costello and Leslie Hems, research director at the Centre of Social Impact at the University of NSW. The online directory follows the formation of the federal Office for the Not For Profit Sector and soon to be launched Australian Charities and Not-forprofits Commission (ACNC). The directory is free and is available at www.connectingup.org/directory

EGGS FOR APPLE

FANS of Apple products eagerly await the release of each new product or gadget. Wanting to get a jump on their comrades in the “I’ve-got-the-latest” race for peer group recognition, about 500 Chinese started lining up at about 5am outside Apple’s main store in Beijing wanting to get their iPhone 4S. Inexplicably, the store belatedly announced and without explanation that the phone’s release had been delayed. Crowd members pelted the store with eggs and yelled “Open the door” and “Liars”. The angry reaction is not surprising, given that the temperature was minus 9 degrees, but you have to wonder how many Apple followers carry eggs on the off chance they’ll be denied an upgrade.

Deposit law backing MORNINGTON Peninsula Shire Council is supporting Container Deposit Legislation in Victoria. The shire has agreed to write to the Minister for Environment and Climate Change pointing out that Container Deposit Legislation would improve recycling, help reduce littering and stimulate investment in product development from recycled materials.

Boatshed boost to fund A FRANKSTON Rotary club will rebuild a bathing box on the foreshore and donate the sale proceeds to council’s community fund. The latest foreshore boatshed offered for sale last December fetched about $110,000. Council will supply goods and services valued at nearly $40,000 to Frankston Sunrise Rotary whose members will donate their time and skills to the rebuilding project that involves the sites of boathouses numbered nine and 10. If successful, Rotary members will rebuild the second boatshed next door. The boatshed will be auctioned immediately it’s finished. A boatshed owner must be a resident ratepayer or own a holiday home or own and occupy commercial premises within Frankston City.

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1. FRANKSTON Business Chamber’s February networking night was sponsored by Core Fitness, Nepean Highway. From left are Wayne O’Neill, of Corporate Shadow Security; Chris Blaber, of The Virtual Network; Douglas Curtis, of SkilsPlus; and Allan Hamilton, founder and managing director of Corporate Shadows Security. 2. CORPORATE Traveller opened its Mornington office in December. From left: Joel Weber, Natalie Mersin, Olivia Guiney and team leader Dave Wilton. 3. Guests at Corporate Traveller’s Christmas party are (from left) Lloyd Howarth, Brooke Hughes, of Cathay Pacific, and Richard Goldsmith, of Carroll Goldsmith Solicitors. 4. SKILLSPlus Breakfast at Frankston on Friday 2 December: Shane Murphy, left, business development manager of Mornington Peninsula Shire, with Ian Barker, federal Department of Education, Employment and Workplace Relations. 5. MT ELIZA Business Network Christmas break-up: Tony and Millar Sambell, of Spicy Web Design with Steve Aarons (rear) of Red Sky Entertainment. 6. And Jenny Williams, of Delphinus Cruises, with Chris Nimos, of Rapid Click, an on line services operation. 7. FRANKSTON Business Chamber trivia night, raising funds for Frankston City’s Mayoral Charity Fund. Winners were Robyn and the Rascals. Seated left to right Gisela Bottcher, Wolfgang Bottcher, Robyn Anderson, Kathryn Ebbott. Standing: Max Coulthard, Garry Ebbott, Jim (Max’s friend), Murray Trapnell and Jacqui Carroll.


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8. MORNINGTON Chamber end-of-year break-up at Mornington Yacht Club. Charles Lawoko, of Alpha Computers, Mornington; John Woodcock; Scott Crowe, of Akarba Party Hire; and Graham Nash, of Beachside Photopgraphy. 9. James and Tina Eling discussing their new product, http://www.marketing4restaurants. com/, which is revolutionising the way the restaurant, cafe and take aways market their business and find more customers. 10. SAND sculpture at Frankston Foreshore over summer and autumn. Brodie Harper from Channel 9’s Postcards with Sharon Redmond, director of Sandstorm Events. 11. Karen Watson, manager of Quest Apartments, Frankston (see story below); Cr David Asker, of Frankston City; and Cr Anne Shaw, of Mornington Peninsula Shire Council. 12. MORNINGTON Christmas Racing on Friday 9 December. Rod Bourne, of Gibson Frieght; David Grigg, of Link Logistics; Robert Braddy, national cargo manager of Etihad Airways; and Ross Di Lizio, general manager of ACP Worldwide.

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Karen Watson, of Quest Frankston and Quest Narre Warren, is captaining the MS Melbourne Cycle team, ‘Quest for a Cause’, riding and fundraising for Multiple Sclerosis sufferers. Karen has ridden in the 46km ride for four years but this is her first year as team captain. (There is also a 15km ride). Last year the team raised more than $15,000 and hope to beat this total in 2012. Quest

for a Cause riders are seeking donations and contributions $2 are tax deductable. To join the team or donate, visit http://www.msmelbournecycle.org.au and search team ‘Quest for a Cause’. • The average age of diagnosis of MS is 30 and three times more women than men are affected. An estimated 18,000 people in Australia have MS and there is no known cause or cure.

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Scientist Chris McEvoy hasn’t sat back to relish the success of a business based on a timber-preserving product used in power poles throughout Australia. He has since developed a vertically integrated timber operation, from plantations and milling to marketing products. Now, he has helped build a luxury resort in Lesotho, southern Africa, which is helping to finance schools and community centres for surrounding villages.

Creating a business by

stopping the rot

Each of the seven million timber poles carrying power and communications lines throughout Australia have a limited life span: they rot and are expensive to replace There are drawbacks to replacing them with concrete poles or running the cables underground.
 Cost is a significant factor. More than two decades ago Chris McEvoy and his friend and work colleague Chen-Woo Chin recognised that timber poles were here to stay and that there was money to be made by anyone who could stop the rot and prolong their usefulness.
 The entrepreneurial scientists were working for the CSIRO at Highett researching timber preservation when they decided to take a chance to profit from their findings.
The research was not quite finished, but they did a deal with the CSIRO, which allowed them to start a private company and hire their former employer to complete refining and proving the product in return for five years’ royalties once it hit the market.
 The rest is history: the two partners invented a relatively benign substance that can be placed in a hole drilled into the poles. The “stick” resembles a piece of chalk and the chemicals are only activated when the moisture content in the pole reaches the critical level when rot would begin to take a hold.
 The preserving chemicals then spread evenly through the timber. The two scientists also created the equipment to make their product.
 Because it is unlikely there will be a drop in the number of poles in

Words & pictures by Keith Platt

Australia and the treatment has to be redone at regular intervals, the income stream from the original Preschem
 company in Cheltenham, is assured. It all sounds so simple, and in some ways it is, but McEvoy and Chen-Woo were the brains behind the research and in the right place at the right time.
 Not all entrepreneurs are so lucky, certainly not all scientists,
 but McEvoy has an inquisitive mind and, it seems, has always been open to the pursuit, development and expansion of new ideas.
 Now the sole owner of the IP (intellectual property) of Polesaver Rods, McEvoy, a Mt Martha resident, is using proceeds from their continuing success to fund other enterprises, both business and philanthropic. On the business side he has developed wood finishing products; bought a sawmill; established timber plantations; and operated holiday villas in Bali. The Bali venture led to the idea of building a five-star tourist lodge in a national park in southern Africa for the benefit of surrounding villages.
 His sense of social responsibility also spurred him to arrange for teachers from the Mornington Peninsula to spend time teaching in these villages. McEvoy is also turning his attention to reducing the high infant mortality rate in the nation where the incidence of HIV/ AIDS infection is estimated at 20-30 per cent.


10 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | March 2012


COVER STORY

CHRIS McEvoy juggles his timber preserving business with using the rewards from a plush tourist resort to help villagers in southern Africa.

s s

McEvoy has vertically integrated his timber businesses – from growing trees to milling and selling (Radial Timber Sales at Dandenong and Yarram) as well as selling preserved and sawn timber products, (Preschem in Cheltenham).
 His radial sawmill at Yarram in South Gippsland is the only one in the world and, he says, creates less wastage and a more stable product.
 The mill was started by Andy Knorr, described by McEvoy as “a typical greenie” who decided that rather than protesting he would find a more efficient way of producing sawn timber.
 Knorr’s method to make rectangular boards from circular logs involves cutting to the radius and then either parallel or at right angles to the growth rings. 
McEvoy said Knorr was “a bit before his time” but sees a bright future in the radial saw process once more plantation hardwood is available.
 In a May, 2009, submission to the Victorian Timber Industry Strategy, McEvoy claimed the existing strategy was misleading in that it stated that Victoria had the largest plantation industry in Australia with 46 per cent being devoted to hardwood, although, in fact, it was all destined for woodchips.
 “Something must be done now to ensure that significant hardwood sawlog plantations of the right species are established in commercial quantities. I could wait no longer and have started establishing these myself.”
 McEvoy predicted there would be “no timber industry in Victoria” unless others followed his lead.
 “Timber is a renewable resource, no way is it finite,” he tells BusinessTimes. “And they’re never going to undiscover timber.”
 Although he has plantations that will supply hardwood for radial milling, he admits “40 to 50 years is a helluva business plan”.
 McEvoy believes his Heartwood Plantations is probably the biggest hardwood plantation owner in Victoria, “but even that’s not really very much” when it comes to satisfying demand.
 He says it is “quite a science” to get timber growing straight and healthy, involving genetics and soil quality.
 Heartwood’s ongoing research and development has shown the benefits of growing a combination of trees, including nitrogenfixing wattles.
 Heartwood Plantations’ general business manager Jon Lambert founded the non-profit Christian organisation Beyond Subsistence which is undertaking several timber-growing projects in Africa.
 “I like the idea of being in charge of my own destiny and business,” McEvoy says, “but the two didn’t go hand in hand at CSIRO.
 “Scientific boffins usually have no business sense.”


McEvoy describes how he and Chen-Woo listened to other CSIRO scientists talking about the day they would “get out”. 
“Some of them had been there 50 years. We had the initiative and enterprise to leave.
” He believes the royalties earned by the CSIRO “made it 10 times more than if we had paid for the work”.
 The two partners were the only employees at the first Preschem factory in Cheltenham, knocking on doors and doing their own marketing to fill a niche.
 “It was the best decision I ever made, but some days it also seemed like the worst. It was hard stuff.
There were setbacks and roadblocks but we had a belief in the technology and the product.
 “We had developed a very simple oil-based formula, including a moldicide. It started selling from day one.
 “We were the only ones. It was a specialist market, but we didn’t realise how big.”
 Fifteen years later McEvoy is still dealing with many of those early customers.
 The big break came when they created a treatment for the power poles that did not involve dangerous substances such as creosote. 
“We made a pre-measured, easily placed capsule that did not require the wearing of protective gear.”
 Sales to the former State Electricity Commission of Victoria soon led to interest from power companies in other states.
 McEvoy says there are about 150,000 concrete power poles in Australia, but they come at four times the cost of timber and have their own problems: heavy to lift; prone to damage; their steel reinforcing creates “concrete cancer” and its conductivity prevents them being placed near telecommunication pits.
 Since the introduction of their preservative, annual replacement of timber poles in Victoria has dropped from three per cent to .25 per cent. 
“There was no Eureka moment, it was all trial and error,”
 said McEvoy, adding that competitors have come and gone, including a couple of large international corporations.
 While the product has been accepted throughout most of Australia (South Australia doesn’t have timber poles), New Zealand and Papua New Guinea, attempts are continuing to break into the Unites States where 200,000,000 timber poles present a tempting market.
 Political lobbyists (“hidden protectionism”) and requirements continually being asked of Preschem have created obstacles but McEvoy is unfazed: “We know there are opportunities there so it’s worthwhile to keep trying.”
 The global financial crisis created few problems: “Our market doesn’t necessarily go up or down. Every utility in Australia uses wooden poles.”
 Preschem has had few price rises, preferring instead to absorb cost increases by becoming more efficient.
 “I’m still amazed at how little people know about decay and rot in timber, they think it’s an animal. “Termites are a problem, but decay causes five times more problems in homes than termites.
” In Bali more than a decade ago McEvoy liked the villas P.22

March 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 11


AUDIO VISUAL

Show and sell: Chris Selby (right) with son Kai at Frankston Hi Fi’s home theatre display, above, and the award winning Bat cave.

Home at work

CHRIS Selby’s business life revolves around sight and sound. He likes recordings of both to be clear and precise when shown or replayed. Selby sells top shelf audio and visual equipment. But his job does not stop at the shop counter. The type of customer that buys the brands that Selby prefers to deal in, also knows that placement – where the equipment sits in a house – can have a major effect on its performance. This factor also influenced Selby into radically dividing his Frankston Hi Fi store into two vastly different areas – upstairs and downstairs. At street level the shop facing Nepean Highway is all glass doors, window displays, flickering TV screens and serious looking speakers. It is a long, narrow area that comfortably moves shoppers from one display to another. The effect can be a bit like being at a trade show. But it is upstairs where Selby’s shop takes on a different feeling. It is like no other in Frankston, or probably even Melbourne for that matter. The retail space above has been remodelled as a well-proportioned, expensively and tastefully furnished house. The “lounge” is complete with coffee table, couches, carpet, subdued wall lighting, and a floor to ceiling custom-built cabinet fitted with a flat screen TV and sound system. The depth-defining feature wall has a mural, a trompe l’oeil of an Italian-style walled garden seen through three arches. Customers can sit back with Selby or one of his staff to get the feel of top-of-therange audio/visual equipment.

Story and photos by Keith Platt Down the hall, two padded doors have large metal star-shaped handles. Tug on the door and you are in a small movie theatre. Theatre-style seats face a large screen. The surround sound of a Hollywood blockbuster deadens any hint of noise from outside. “The idea is for you to be transported into a private movie theatre,” Selby says. His company can wire up sight and sound individually to every room in the house, all operated from a wall-mounted touch screen, or individually. The home theatre is the pinnacle of Selby’s product: a total experience in which the room is a production in itself. One client, a Batman fan, had Selby reproduce a Bat cave for his viewing pleasure. After discussing the hardware needs, Selby’s next call was to a set designer. The resulting Bat cave almost makes the viewer part of the movie, providing it’s a Batman movie. The project won Frankston Hi Fi an industry design award from the Custom Electronic Design & Installation Association for projects over $100,000. When he started Frankston Hi-Fi in 1982 Selby dealt a “staple product range” of turntables, amplifiers, speakers and tape decks.

12 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | March 2012

“The CD player had just been introduced – quantum leap – and many traditional hi-fi stores stayed with that core range of audio product,” he said. “Video technology – remember the Beta and VHS days? – led to a strong presence in store of a combination of audio and video combined as never before.” The early stages of “surround sound” enabled customers “the atmosphere of the cinema in their own lounge”. Videotape quality was surpassed by the laser disc, which quickly disappeared with advent of the DVD, which had come along behind plasma big screen TVs. These days customising a home for the ultimate “entertainment experience” includes speakers that can’t be seen, control systems that can operate DVD, Bluray, Apple TV, Sonos, media servers, streaming, Foxtel, iPod, CD and radio from anywhere in the house or garden (including TVs that drop out of the ceiling). Although Selby relishes the challenge of providing a themed home theatre, the more conventional ones are most often the order of the day. Whatever the job, he says his “team” is just as enthusiastic. “From the very basic to the extreme request, the enjoyment of the client on handover of their system continues to inspire the team to keep improving the standard of our solutions and servicing both during and after the sale.” He admits that being the most innovative “hasn’t made us the most successful financially”, but prefers quality to quantity. “A lot of what we do is designed to be built on and absorb new technology.” Selby finds the twists and turns of home entertainment electronics an interesting road to follow and had always attended overseas or interstate expos to keep up with the latest trends. His enthusiasm is hard to avoid and no doubt contributes to the fact that more than 90 per cent of business comes through customer referrals. “That is something we have always enjoyed and could not survive without.”


CORPORATE TRAVEL

The business of travel savings MANY companies find that interstate and international travel is essential to maintaining and growing their business. And with significantly more companies focused on reducing operating costs, expert business travel management is becoming a crucial strategy for improving bottom line savings. This is where Corporate Traveller Peninsula steps in. “The team at Corporate Traveller Peninsula will guide businesses toward the right type of airfare, leverage specially negotiated corporate rates for car hire and hotel accommodation, maintain travel policy compliance and streamline buying and booking processes for greater efficiencies at every level,” team leader Dave Wilton said. “We are heading into a new year of market conditions. For businesses that rely on travel for growth and for maintaining relationships, it’s crucial they are booking and buying travel smartly rather than ad

hoc over the internet. As a single point of contact for all bookings and travel ienquiries, we can save organisations time and provide tangible cost savings.” With more than 50 years combined experience in the travel industry, Corporate Traveller Peninsula offers

a team of business travel experts dedicated to providing local and personal service. The team of four travel managers including team leader Dave Wilton, assistant team leader Natalie Mersin, Olivia Guiney and Joel Weber opened their new office in Main St Mornington, in November 2011. They manage the travel programs for local and state businesses across a broad range of industries. Dave said his team had proven success in helping businesses save money and time on their business travel. “We all have extensive experience in all facets of corporate travel management including co-ordinating bookings, accommodation and car hire as well as travel policy management, transfers, travel insurance and visas for business travellers,” he said. “As travel experts we can also help companies with VIP travel, group and conference bookings and accounting from invoicing through to detailed reporting and cost –saving analysis.”

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March 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 13


SUPERannuation

LOWER TAXES KEY TO SUPER FUTURE A VITAL part of any long term wealth plan is superannuation. The governments of Australia over the past 15 years have made positive law changes in superannuation to make things easier. “Simplified Super” was introduced a few years ago and this has made a previously very complex area somewhat easier to maintain. Superannuation has always enjoyed a lower tax environment and every change in super tax law over the past 20 years has also had a positive effect on tax, except one. The superannuation surcharge took the effective tax rates on superannuation for some higher paid individuals up from the standard 15 to 30 per cent in some cases. Thankfully, the superannuation surcharge was abolished in the mid 2000s and tax law changes since have continued to make super an attractive investment vehicle and the key area of strategy focus for retirement planning.

MBA Business Solutions, Mornington, believes that superannuation will continue to receive bipartisan support to be an attractive and concessionally taxed area of the Australian economy. The social and demographic commentators in Australia often report on the ageing Australian population; and of course in the next 10-20 years there will be many baby boomer Australians accessing a huge amount of retirement funds from the national savings. It is in the interest of all political parties to encourage our population to self fund for retirement, instead of accessing public money via Centrelink pensions. It is MBA’s opinion that the two major political parties understand that the superannuation environment is the long term answer to our baby boomer and future generation retirement funding issues, so that keeping this area tax advantaged is the key to making that happen. MBA says it often hears people saying that they want to steer clear of superannuation because of the constant law changes;

because it is too complex; or because they want to control their wealth and access it whenever they like or need. However, no other form of investment carries the tax advantage of superannuation. Self-managed superannuation may be the solution if you agree that superannuation will remain tax advantaged but are still concerned by the lack of control of your own investments. For many years, industry funds and retail funds dominated the superannuation monies managed in Australia, and in fact self-managed superannuation funds (SMSFs) were relatively uncommon. But by 30 June 2009, the SMSF sector was the largest superannuation sector by number of funds and asset size. At that date, there were about 410,000 SMSFs, representing 99 per cent of all superannuation funds and around 31 per cent of total superannuation assets. Source: Review Into the Governance, Efficiency, Structure and Operation of Australia’s Superannuation System, Commonwealth of Australia, 2009.

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Porn at Work There has been some media coverage of a test case before the Federal Court regarding a female worker being exposed to pornography who is suing her employer, Air Services Australia, for bullying and sex discrimination. This story highlights some of the issues that are raised by lax browsing policies at work. Firstly, it is important to understand the impact that pornography can have in the workplace and the issues and potential liabilities that it raises. A second issue with unlimited browsing is that it allows access to websites that are NSFW (Not Safe For Work) and they are much more likely to be infected with malware such as Trojans. Trojans can contain keyloggers which will capture keystrokes and passwords which are then filtered out by criminals looking for usernames and passwords for online banking accounts. This is a very serious threat for all small businesses.

There are three things that you can do to protect your network and your business. The first thing is to have a policy for internet usage which employees sign. The culture needs to reflect that inappropriate surfing is not acceptable and not tolerated. This should stem the

amount of inappropriate surfing and decrease the amount of malware that is downloaded. If web surfing is tracked, this should be reflected in the policy. The second thing is to ensure that your antivirus programs are up to date. This will help protect against malware at the desktop level. Ensure that the software you use is centrally managed so that you can see when a client has not been updated and that you can be certain that everyone’s AV program is up to date. Sadly, these days having up to date antivirus software is no guarantee that you will be safe, so we need to stop malware before it enters the network. The last thing to do is to install a firewall that will both track what websites employees are going to and also block most of the malware and viruses that may be downloaded. We use Cyberoam firewalls because they have very good reporting and also do quite a good job of catching malware before it gets onto the network. Employees are a lot more restrained in their browsing when they know that what they are looking at is being logged. Cyberoams even capture which Google searches are being done and by whom, which can make for very interesting reading indeed! If you would like a copy of a sample internet policy to take to your lawyers, please email sales@ extremenetworks.com.au or call 03) 97857162 and mention this article and we can send out a copy of the one that we use. If you would like a demonstration of a Cyberoam firewall, please contact us and we can provide more information or a trial unit.

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Showbiz lift for brothers IF he’s not at the boat sales showroom he runs with his brother Michael, Theo Rozakis can be found somewhere in Australia or New Zealand fishing and then cooking his catch for the cameras. As the presenter of River to Reef (Foxtel and Channel 31) Theo finds enough synergies between the two “businesses” to justify a few days away from the M Y Marine’s Dromana showroom by merely saying “I’m going fishing”. Happily, the boats and equipment used on the weekly TV show are pretty much the same as those sold by M Y Marine – Rae Line, Stabi-Craft, Surtees and Haines Hunter boats and Honda and Yamaha motors. The brothers say their showroom in Nepean Highway just off the Mornington Peninsula Freeway is the largest on the peninsula. Selling new and used boats, M Y Marine also stocks trailers, marine equipment and has a repair workshop.

Theo Rozakis on location for his television show River to Reef.

The company was established on the peninsula in 1992 after Michael Rozakis qualified as a marine mechanic and started out as an “on-site mechanic”. Demand for his services soon outgrew the van and the business moved to premises at Safety Beach. Within a few years it was apparent the brothers needed a factory. “We built here in 1998 – moved in the

following year – and have never looked back,” Theo Rozakis says. River to Reef is a bonus. “I get recognised on the street and in the shop and Surtees, whose boats we stock here, is a main sponsor of the show. People see me using the equipment we stock, so it feeds back into the business.” The TV boat is a 6.7 metre Gamefisher powered by a 225hp Honda four-stroke engine. About a year ago the show was able to supply footage of the Queensland floods to the Seven network when a segment was being filmed during the downpour. “We just happened to be there and they used our footage to show some of the flood damage and then interviewed us talking about all the great things Queensland had to offer despite the devastation,” Theo said. A quick tour of the M Y Marine showroom shows many craft with fittings more comfortable than a luxury car. But the biggest change to getting on the water in recent years, according to Theo is the engines that drive the boats: “Those horrible, smokey two-strokes to beautiful, smart fourstrokes.”

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A propelling performance “THANKS once again for the prop. It has made a huge difference and turned an already good boat into a fantastic boat with excellent cornering.” To say Col Van Der Lugt is happy with his new prop is clearly an understatement. “If I had one piece of advice it would be to speak to your Mercury dealer about what propellers are available that will specifically help you. The difference a prop can make is amazing.” A Melbourne-man, Van Der Lugt has had boats for 35 years and when he bought his new Bayliner 185 bowrider he was happy with the three-blade, 19 pitch aluminium prop working with the MerCruiser 4.3 litre TKS V6 sterndrive engine. “It all worked well, and plenty of people would have been really happy, but because I’ve been into boats for so long I thought we could get more out of it,” he said. Van Der Lugt consulted the Mercury

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propeller selection chart and started asking questions. “Mercury recommended the Revolution 4 – a stainless steel four-blader, still at 19 pitch – and it’s turned a good boat into this thing that turns on a dime. It’s made a huge difference.” The Revolution 4 is one of the props which features Mercury’s Performance Vent System (PVS) which allows customers to truly optimise their propeller to perfectly suit their boat and boating conditions. “I used the 7mm plugs with the PVS and they improved the hole shot immensely,” Van Der Lugt said. “There’s no cavitation or over-revving on takeoff. We’ve got a great mid-range, we cruise easily at 40 mph (64 km/h) and top speed is 53 mph (85 km/h). “They say the prop makes the biggest difference to your boat’s performance, and that’s so true.

Col Van Der Lugt is having many happy turns with his new Revolution 4 prop.

“If you take a bit of time and work out exactly the right prop for your boat and what you want to do, the benefit will be enormous.” There are more than 700 props in the Mercury Marine range.

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HEALTH

What are the odds? HAVE you ever stopped to think how mind-blowingly, breathtakingly ridiculous it is that you are even here? I mean, what were the odds? Forget Tattslotto, the chances of you being right here, right now, living and breathing in the world are so highly improbable that I’m struggling for a suitable word to describe them. Let’s settle for miraculous (as in absolutely extraordinary, rather than the divine implication). If life were a lottery, you’ve already won the first division prize over and over. We’re talking those sorts of odds. Consider this: You and I are the end result of the evolution of at least 185 million generations of life on earth. Yes, on science’s best estimate, each of us has parents, grandparents, greatgrandparents and so on stretching back at least 185 million generations. What is astounding is that every one of those ancestors of ours – from the earliest single-celled amoeba in the primeval sludge to the first arthropods, amphibians, reptiles, right through the dinosaur epoch, mammals, all the millions of years into more recognisably human history – Neanderthal man, Homo erectus, Homo sapiens – every single one of those millions of ancestors lived long enough to reproduce. Yes, through ice ages, meteor strikes, virulent bacteria and the awesome predatory power of dinosaurs. Through fires, floods, famines, plagues, wars – all those random but real dangers to life – every one of your 185 million ancestors beat the odds. Each lived long enough to give birth to the next generation, and then to nurture those young to maturity.

Michael Ellis*

Chinese Herbalist

(Mind you, those of us here today have many ancestors in common – it’s not as though we all have 185 million different ancestors, but my point still works.) When you think about evolution like this, every living creature on earth constitutes an incredible genetic survival story. How much luck did your genes need to get this far? What got me thinking this way was a combination of two things: a book for kids by Richard Dawkins on what science now knows about life, the universe and everything called The Magic of Reality (New York: Free Press), and my 25th wedding anniversary. Looming life milestones always tend to give you pause and, I guess like most people, I got to pondering some Sliding Doors scenarios. Imagine if circumstances had conspired differently and my wife and I never got together. What would the world care? Probably not at all – except that our genes would not have merged to create two new lives in the form of our daughters, who are unique combinations of both of us. It’s possible to imagine us as never having met, but it’s a lot harder to imagine our nowadult daughters as not being in the world. My wife and I would likely have ended up with other partners, and perhaps had a couple of kids each with them. So in my Sliding Doors thought bubble:

that’s two people who would have not been here, and four different people who would. Consider their potential spheres of influence and mix of partners and multiply that a few generations into the future and the world would be populated by a lot of different people than it’s otherwise going to be. Where am I going with this? Not sure if I know myself. Except to say that musings like this remind me just how random life really is. Think of all the creatures, beings, generations, species that didn’t make it. I was kayaking in a NSW estuary and watched a knee-deep pelican fossick some shellfish morsel from the mud and gulp it down. For all its sensory existence to that point, that oblivious crustacean had been going about its mud-loving business. In an instant it was disappearing down a predator’s gullet already part digested, its entire being, genetic material and all, to be assimilated into an entirely different organism. In our civilised world we humans have minimised risk and maximised our chances of survival – to the point that we are shocked when something randomly terrible happens to someone. But for most of those 185 million generations, the randomness of life and death – here now, gone in an instant – has been the reality. If I were a Precambrian era gambler, I would never have taken the odds about my genes being relayed successfully through 185 million (and one) generations. But enough musing and back to reality. I’ve got to get down the shops to buy my wife an anniversary present. And a Tatts ticket. * Michael Ellis is a registered Chinese herbalist in Mt Eliza: www.mtelizaherbal.com

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Expert, Approachable, Respons MARKETS

Dotcoms return You may remember the mayhem and tears when the “dotcom” bubble exploded. Companies with zero income were listed on multiples of estimated revenue and often with plain silly business ideas. A few ideas that were precisely Richard Campbell* suited to internet were jumbled Stock analyst up with dozens that were not. Stock Analyst Recognising the differences wasn’t as clear cut as it seems now and many wondered how pip-squeak companies selling real estate or auto ads could overthrow the entrenched market power of the likes of Fairfax. What seasoned investors failed to grasp at the time was that the internet had great potential for display with its speed, colour and depth. Text and image could be constructed in three dimensions. You simply clicked to go down a level and then a further level. But at the time it was unclear that super fast internet speeds were coming to allow this depth to be fully utilised. Google Earth added a further dimension for property buyers. A few clicks and you could see the backyard, the neighbouring house and even the look of the people opposite. But that was all to come. When the dotcom sector imploded in 2000, Real Estate dotcom slumped with the rest but the media companies were slow to respond partly for fear of cannibalising their mastheads and partly because they believed their own content was enough to attract “eyeballs” to their traditional ads. It was a fatal mistake. Twelve years on as mobile internet adds further connection REA Group (the former Real estate.com) operates in 11 countries and has more than twice market share locally than its nearest rival Domain.com (Fairfax). Seek listed in 2005 and has a 70 per cent market for job ads well ahead of its nearest rival Career One which has 18 per cent of the market. (News holds 50 per cent) Carsales.com has 75 per cent market share across a dozen portals leaving very little for the drive.com.au, the Fairfax portal. (News holds 61per cent). In the latest results each had strong profit uplift –all over 20 per cent at a time when the old economy stocks are feeling the lash of online competition often made worse by the high $A. For Fairfax the pain intensifies. Profits fell by 18 per cent this half and would also have been worse if its New Zealand based

on-line auction business Trade Me had not done so well. Fairfax paid $700m for it six years ago, taking a $200m dividend in 2011. It will sell down 35 per cent to pay down part of its $1.1b debt so what at the time looked over-priced has stemmed what may have been a total bloodbath. So what are “take outs” from transformation? First the sceptics were both right and wrong. While the on line opportunity was narrower than the geeks had expected, it grew with the technology. It was also the ideal platform for delivery of large item price data. Second, the net is not as low cost as many assumed. Staff numbers are often high to monitor and maintain service. But third the margins are still good. Carsales.com keeps 55 per cent of sales revenue and so long as it keeps rivals at bay with promotions and quality oflegal offer, services it has monopoly characteristics. We can say that a For all a business and its people need new set of “blue chips” has arrived. Each of these three companies Est. 1954 during the GFC and lifted profits in the worst market for held ground decades. All have low or no debt. REA Group has cash of $152m for more acquisitions. Fourth, there is scope for expansion organically and by acquisition Seek’s China portal doubled its profit this half. Fifth www.whitecleland.com.au the next phase is the integration of the internet with more traditional business methods. Domino’s Pizza mentioned in a recent column is one of the exponents with its own menu “app”, its ability to Level 3,prime 454 Nepean Hwy Frankston 9783 2323 email special offers and its social media promotions. *Richard Campbell is Executive of 9602 4022 Level 8, 256 Queen Street, Director Melbourne Peninsula Capital Management, Tel. 9642 0545.

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March 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 19


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20 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | March 2012


MANAGING

Challenging paradigms A PARADIGM (para-dime) is a concept or belief that shapes how each of us assesses our environment. This term has been used in science for centuries to describe the laws and theories that shape current scientific knowledge. In recent years, its use has been widened to include business applications where it refers to the collection of rules and concepts that form the framework within which each business operates. Think of them as the collection of concepts that define the box that represent the boundaries of your current business. Business leaders select and shape paradigms based on their personal beliefs and experiences and by selecting paradigms from businesses that they admire. Larger organisations spend years developing and refining their paradigms and shape them into policies, rules and regulations that they deploy throughout their organisations. Good management is focussed on defining exactly how they want the business to operate even to the extent of having standard job descriptions and work procedures that apply to every job. In this way, they can ensure that each example of their product or service is produced exactly to its specification. Think of McDonalds, whose focus is to produce millions of the same quality Big Macs every day at every store throughout the world. Every business needs some of this, otherwise the customers would not know what to expect from a business. Operating your business within its box with clearly defined paradigms is very important, so it is worth investing some time to clearly understand your current business paradigms. There are many ways that you can do this, but a simple start point is to write down and collate all of the major concepts and rules that shape your current business, and to then discuss these with your people. It has been said that if all the people in the world were reasonable, then nothing would ever change. This means that you have to be unreasonable occasionally in order to drive change and improvement. Business leaders are responsible to drive improvement in their business and, to do this, they have to be creative and unreasonable at times.

Hamish Petrie*

Business Consultant

It has been said that if all the people in the world were reasonable, then nothing would ever change. This means that you have to be unreasonable occasionally in order to drive change and improvement. This means that they need to change their paradigms, forcing a change in their rules of business. Once you clearly understand the paradigms that define the current box for your business, then it’s appropriate to challenge them to try to work out how to drive major improvements with some out of the box thinking. In the big business world, a great example is Apple, which grew to be the world’s most valuable company in terms of market capitalisation during 2011. Ten years ago, the paradigm was that computer manufacturers did not sell their own products. Computers were sold by retailers who stocked a range of products so that the customers could evaluate which technology best suited their needs. Around this time Apple CEO Steve Jobs hired Ron Johnson, a Target merchandising executive, and together they challenged this paradigm. Within a short time, they developed the concept of the Apple Store based on offering customers a totally different experience when shopping for computing gadgets. This retail experience was so different and so aligned with their customers’ needs that, in just a few years, they have launched over 360 Apple stores worldwide and reaped enormous and repeatable success. At a time when many people had forecast that all computers would be sold over the internet, customers are queuing in front of Apple Stores. If you have been to an Apple Store, you know what I mean. If you haven’t, then try to get one soon, as it is a very clear

demonstration of just how revolutionary a paradigm shift can be. At a local level, there are a number of bakeries in our area and nearly all of them produce a traditional range of pies, cakes and snacks. However, one bakery has rejected the paradigms of the baking business and produces a range of innovative, interesting, healthy products. There is virtually no overlap in the product range offered by the traditional bakeries and it has built a creative reputation that stretches far and wide. At any time of the day there is a line of customers outside the store, whereas the traditional bakeries struggle to survive. Clearly, the innovative bakery has redefined the paradigms of the bakery business and is reaping a huge benefit because of it. The store is not fancy, its location is not great, it’s a tiny shop, but the combination of its innovative products and personal service make it a standout. So it doesn’t matter how big or small your business is today, every business is both strengthened and limited by its paradigms. Defining your paradigms clearly has a good side, as it will help you to develop a very clear set of operating standards that assist you to produce consistent products. Challenging these paradigms can be the game changer that creates the opportunity to differentiate your products, services and business from your competitors. Action Planning Questions: Have you written down the major paradigms that shape your current business and products? Have you deployed them to all of your people so they understand what is required from them? Have you spent ten minutes in an Apple Store observing how they manage the store and its impact on customers? Can you identify a local business that has changed the normal rules in its business and gained competitive advantage by doing so? Have you identified an exiting business paradigm and been unreasonable in driving change in your business? © Hamish Petrie November 2011

*Hamish Petrie had a 37-year corporate career including 29 years with Alcoa Inc. His last position was as VP–People and Communication for the global Alcoa corporation based in New York, NY. He can be contacted at hamish@nitroworld.net or on 0404 345 103.

March 2012 | Frankston / Mornington Peninsula / Dandenong BusinessTimes | 21


planning

Property investment: yes or no?

CREATING BUSINESS BY STOPPING THE ROT s s

where they were staying in Legian and called the owner in Perth and the two became partners, building another two.
 This enterprise led to a more expansive plan for a lodge in Lesotho, an independent kingdom entirely surrounded by South Africa.
Grander in scale and more uncertain of success, McEvoy teamed up with an old school pal, Nick Ring, “who I’d always spoken to about building an upmarket place”.
 Ring, a builder, had been working in South Africa for some years and agreed “tourism needed the higher end”.
 Since opening Maliba Mountain Lodge, McEvoy and his partners have established a community trust with the idea of using profits from the lodge to help the Basotho

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property, it is wise to apply for a Flood Level Certificate from the relevant floodplain management authority. Such a certificate will advise on the required finished floor levels. Flood levels and the impacts of climate change including rising sea levels are subject to constantly evolving policy as further advances are made in adaptation planning. For example, the Flood Level Certificate may identify that a site requires more than one metre of fill to meet floodplain management authority requirements. This may render a development opportunity unviable.  Even where a site is not subject to a flood overlay, it may still be relevant to apply for a Flood Level Certificate (eg. where a planning scheme amendment is afoot which proposes inclusion of the land within a flood overlay). Other planning scheme amendments may include subtle changes that could affect your development opportunity: a planning scheme amendment might include the removal of a Development Plan Overlay from a site with the effect of resuming third party notice and appeal rights which did not apply to the land while subject to the overlay.  Clearly, third party notice and appeal rights increase the uncertainty of achieving a planning permit at the local level without an appeal to VCAT, which, in turn, leads to delays and holding costs. Similarly, beware of CFA requirements. Sometimes land may not be subject to the Bushfire Management Overlay, but a council may still refer the application to the CFA for comment. While the CFA cannot direct the responsible authority to refuse the permit application, it may appeal any grant to

people in nearby villages.
 The five-star lodge’s website says that “providing employment and upliftment of the local people” were “driving influences in establishing a world class tourist lodge”.
 The lodge was built using mainly local labour, with many now trained and staying on as barmen, security, house staff, gardeners, and maintenance workers. 
 McEvoy says that although Lesotho has the highest literacy rate in Africa its low gross national product sees little money spent on public health or hospitals. “It’s estimated 30 to 40 per cent of people have HIV/AIDS which is placing a tragic stress on families and the health care system. McEvoy, who sponsors annual visits by Australian teachers, would like to extend this model by bringing midwives to Lesothu.
 Mailiba lodge is within the 5600 hectare

Ts’ehlanyane National Park and offers spa treatments and massage therapy, while urging guests to get involved by offering time or money to help with the school donation program, a “community forest” and projects for farming bees, craftwork and growing free range chickens. 
“I want Maliba to be something that puts back into the community,” McEvoy says.
 Since opening in September, 2006, the lodge has produced the cash to rebuild four schools and open the first of two planned community centres that can be used to run adult education courses.
 “Schools are bringing students to the lodge to see what we do and boys who normally drop out to become goat herders are realising there are other opportunities for them.
These attitudes flow on to the parents. School pass rates are going up. It’s really encouraging”.


22 | BusinessTimes Frankston / Mornington Peninsula / Dandenong | March 2012

s s

By Megan Schutz LAND development can yield a good return provided it doesn’t get caught up in red tape or the development planned is not made unviable by regulatory requirements. Many sale properties are marketed as development opportunities. To really know whether the opportunity is worthwhile, you need to carry out due diligence that goes beyond disclosure in a Section 32 Statement under the Sale of Land Act 1962. Some sites can turn out to be minefields. Properties can be affected by a myriad of regulatory instruments: constraints triggered by the act of development and/or existing constraints recorded on the title or disclosed by policies in the Planning Scheme. Existing constraints recorded on title may include a restrictive covenant, a Section 173 Agreement, or an easement. A restrictive covenant can be removed from title provided you have the consent of the neighbouring owner(s) benefited by the covenant.   Similarly, an application can be made to remove a Section 173 Agreement from a title provided the responsible authority (the local council) consents to its removal, or the Victorian Civil and Administrative Tribunal (VCAT) on application by a party to the agreement, approves an amendment to that agreement.   With land subject to an easement, generally that part of the land cannot be built upon except for landscaping purposes or development which does not inhibit the

relevant authority’s access to its infrastructure within the easement. For certainty about development rights relevant to an easement, it’s best to contact the relevant authority directly. Constraints triggered by the proposed future use and/or development of the land can get tricky if you are not a seasoned developer with professional planning advice. Sure, the planning scheme on its face says that the land is suitable for your development.  However, this is not the end of the story. For example, have you checked whether the land lies within an area of cultural heritage sensitivity?  Many parts of the Mornington Peninsula lie within an area of cultural heritage sensitivity. If your land does lie within such an area and your proposed development is listed as a high impact activity (for instance, a subdivision) which is not an exempt activity under the Aboriginal Heritage Act 2006, then a Cultural Heritage Management Plan (CHMP) is a prerequisite.  These plans must be based on a heritage assessment by a suitably qualified cultural heritage advisor to ensure minimum harm to Aboriginal cultural heritage. Their preparation can be very expensive dependent upon the significance of the site.  Where a site is significant, the protection of Aboriginal cultural heritage can impact on the viability of a development proposal and may create significant constraints on the development potential of a site. Another consideration is whether the property is subject to a Special Building Overlay or Land Subject to Inundation Overlay. Where these overlays apply to a


VCAT if it is opposed to the development on the basis that it creates a real fire danger to life and property. This may occur where property abuts a public reserve covered in vegetation. The best way to guard against the

perils of property development is to know as much as possible up front. Where time is of the essence, negotiation of special conditions is recommended, allowing the buyer the time to undertake the necessary investigations.

Megan Schutz is director of Schutz Consulting, +61 418 888 894; megan@schutzconsulting.com.au; PO Box 820 Mornington, 3931; Web: www.schutzconsulting.com.au

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