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Our Stories - Facing The Pandemic

Discussion in 'Money matters' started by Paul - FS Concierge, Mar 17, 2020.

  1. robdash

    robdash Member

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    Hi Rowan, that's a really tough place to be. When I was short of cash I signed up to Zoom2U - it's an uber format for parcels, courier work. Give it a go. They are well organised
  2. Rowan@quaotic

    [email protected] Well-Known Member

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    Thanks Rob, but I live in a small country town in the middle of nowhere. I will have a look though. I am starting to get a few local deliveries now and I hope it will grow.
  3. Rowan@quaotic

    [email protected] Well-Known Member

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    I just messaged them and they are not taking any more couriers due to the virus. I find that a bit odd as the small amount of work I am picking up is because of the virus.
    Paul - FS Concierge likes this.
  4. Greg_M

    Greg_M Renowned Member

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    Somewhat ironic for an old bloke that was considering full retirement, but it seems I'm going to be busier than I have been for a very long time.

    I was going to spend the winter travelling parts of the outback, ha ha.

    Seeing I'm stuck, and assuming the virus doesn't get me, (68th birthday coming up) an old mate and I have decided we can't resist having a dip (we see opportunity everywhere we look) and have entered a loose joint venture agreement that benefits both of us.

    He has a business of 30 years standing, profitable with at least a 4 month forward order book, and in the box seat when the government starts chucking money at getting the economy moving again. The business is well managed but stuck in the stone age when it comes to digital innovation.

    So, we're going to use his business as a type of case study...renovate it from top to bottom as a model of low cost information systems with a focus on mobile tools connecting to everything in the back office (his work force is out in the field, currently using costly paper admin systems).

    If we pull it off, he gets a more saleable business in a year or two. I get the systems/methodology to sell as I please.

    Our rationale is that many micro businesses are crap at the digital world, but are going to be in deep shit without low cost systems moving forward...and that a lot of them are going to back away from paying for ad hoc apps that quickly add up to big $...that we don't believe anyone will be able to afford.

    As old hands, we believe the world will move on (as it always has) but cost will be a HUGE issue.

    At the very least I won't get bored this winter :)
  5. Paul - FS Concierge

    Paul - FS Concierge Administrator Staff Member

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    Good on you @Greg_M - there is nothing like a live business to work on to work out what the real life outcomes can be,

    I hope you will document your work and the subsequent benefits every step of the way - this will be invaluable for future marketing opportunities.

    Judging from living through previous recessions, I agree that many will fall by the wayside and many will thrive post the pandemic.

    Good luck young fella!
    Greg_M likes this.
  6. Lucy Kippist

    Lucy Kippist Active Member Staff Member

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    Hi Greg,
    SO enjoyed reading this - would you give me permission to publish that as an article on Flying Solo?

    Be great to share your perspective.

    Lucy
    Paul - FS Concierge likes this.
  7. Greg_M

    Greg_M Renowned Member

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    Sure, no problem.
  8. Lucy Kippist

    Lucy Kippist Active Member Staff Member

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    Thank you.
  9. El Arish Tropical Exotics

    El Arish Tropical Exotics Active Member

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    Hi guy's, haven't been here for awhile, I'm glad to see most of you are still fighting the good fight. It's earthshattering to have the rug pulled out from under you but it can also force us to make changes in ourselves as well as our businesses. I know that's hard to see when you wondering where your next mortgage payment is coming from.

    March was very intense for us. As soon as we heard the words "global pandemic" we started running massive sales to payoff the credit card and outstanding bills. We've been adjusting to being empty nesters and one of those changes was to buy a better boat that suited our aging bodies. It's been great, plenty of snorkeling and fishing on the reef but there's no money in the kitty for global pandemics so it was imperative we pay off as much as we could. Our sales last quarter we're up by about 15% on last year as people reconnect with their gardens, shop online and plant things they can eat. And then it sort of all fell apart. Australia Post was overwhelmed with packages, domestic flight stop carrying the mail and social distancing at post offices became a big thing. Delivery delays were effecting the quality of our product and we were also seeing a lot of new customers who weren't familiar with our processes and didn't read too much to familiarize themselves. Delivery problems is a terrible way for new customers to get to know your business. It got really stressful and hairy.

    We're still open but now only shipping to Queensland. We're going into a slower time in the year anyway so we've applied for jobkeeper and are using the time to do things we never get around to and just breathe! The veggie garden is up and running and I've started online yoga. There's enough money for fuel (as long as it pays for itself with fish) and we're living day by day focusing on things that are within our control and trying not to freak out ruminating on second waves, the impending recession or zombie apocalypse.

    After two natural disasters we've got a sense of where your headspace needs to be. You have to go into lowgear and roll with the punches. Reserve your energy for the long battle ahead. It's more guerilla warfare than tactical battle as you'll be making your game plan up as things shift. Good luck to everyone and be kind to yourself and others.

    Warm Regards, Ann
  10. Greg_M

    Greg_M Renowned Member

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    The delivery "thing" must be a nightmare for online business atm. Like everyone else I've been ordering stuff quite regularly but at best arrivals have been erratic.

    We actually celebrated (finally) the completion of a new living area on the back of our old stone house by ordering a new smart TV (haven't had a TV for 4 years) and an el cheapo "mesh" system to extend our wi fi...mesh nodes arrived as expected, TV a couple of days later (no big deal)...but the cheapest bit (the wall mounting bracket) has gone missing in action. Seems Toll got hacked on top of all the other issues they must be dealing with.

    The way business is being "hit" seems to be erratic also, our Victorian clients are busy and our remote work for them has increased substantially.

    Maybe some businesses have had time to reflect and work on what they "can" do while they're in lock down.

    As a case in point (and why you shouldn't burn your bridges with potential clients) I spent a lot of time and money pitching a local not for profit on fixing their admin systems...an ongoing dance over 3 years that I was about to put in the bin.

    With nothing better to do, they've decided to clean up their "act". So I'm now being paid to fix it.

    Looks like full retirement is definitely on hold...but I am working on a cunning succession plan :)
  11. Paul - FS Concierge

    Paul - FS Concierge Administrator Staff Member

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    If I have noticed a theme amongst soloers, it is they budget very well but only enough to stay afloat and for some, maybe a bit more during "normal times".

    For the most part this works well enough, but I have always worried that a lot of people in business do not have a "buffer".

    There are a couple few things connected to a buffer that make a big difference:

    1. A lot of businesses do not charge enough. Charging a fair, market price is something we should do without guilt, especially when we think oif the value we are delivering.

    2. Doing things for free. All of those little things add ap and when it is all said and done, cost us very dearly. Mostly, if we ever want to have a chance to build a buffer, we have to charge for the big things of course, but also the little things that take up our time.

    3. Doing 1 and 2 above well, might allow us to save. Be ob the lookout that saving some of your profits, especially in the first year might hurt some, because you pay tax on all of your profits, even if you do not pay yourself all of them.

    4. Understand cashflow. When things get back to normal and we can look forward to growing again, taking on new clients often means waiting for them to set up their systems to pay you. And this can take time. So there can be quite a time before getting the money for the new shiny job you have just won. If you have to buy stuff and pay suppliers before you get that money, you will need cash in the bank to do so.

    And the best way to have cash in the bank is to take steps to build....A Buffer.
  12. bb1

    bb1 Renowned Member

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    @Paul - FS Concierge the one other thing I have noticed here and amongst acquaintances is that most business's don't account for GST. They get to the end of the quarter and have spent it all because they thought it was their money, which as all good small business people know, we are just holding it for a short period.

    In the beginning I always made sure I segregated about 20% of all payments, so at the end of the quarter I could commit my GST and PAYG. Now I have one job which pays monthly (all the rest are weekly), and their payment is sufficient to cover GST/PAYG and my mortgage payment (now savings), so as soon as that payment is received, I transfer the funds to the ATO and my other bank. And by having them pay monthly I am effectively quarantining those funds for safe keeping.

    Also as a contingency when this all started to hit the fan, I doubled the contingency I have in my working account, which thankfully I haven't had to touch.
  13. Greg_M

    Greg_M Renowned Member

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    @bb1 and @Paul - FS Concierge . I've been guilty of all of the above at various times in my working/business life.

    In part because I always had plenty of work and was usually paid well...when I had a cash flow shortfall I just worked longer and harder till it was fixed. That worked when I was young and all ribs and energy but proved to be a crap long term strategy.

    It was "the recession we had to have" that sorted it out for me (no work for a very long time). Virtually no cash flow is a very tough lesson in how to budget. I did learn, though as usual I did it the hard way :)

    Those that survive this current situation will hopefully learn the lesson being offered because I don't see the possibility of any rapid improvement in the economy coming out of this lock down.

    The reason I say this is that I experienced at least 3 to 4 very very tough years coming out of the worst recession since the great depression and that recession really only hit a few sectors of the economy. There was still large parts of the economy that were hardly touched, which is not the case this time around.

    No one really knows what the new normal will be, but I suspect many people will have to lower their expectations of what financial success looks like.

    I think the only tip listed that will really be tough to achieve is no.1 (charge enough)...my experience is that it will be a race to the bottom on price. That's already starting to some extent in construction (a traditional strategy). My construction clients in Vic are seeing contractors already prepared to cut their charge out rates in half to keep working. Mainly I suspect because they don't have any buffers in place...but everyone who does will have to compete with them.
  14. El Arish Tropical Exotics

    El Arish Tropical Exotics Active Member

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    I can't speak for everyone but I know in my experience it took work to change our strategy from "do everything, take everything, claw like a dog to make money, make sure the business survives and grow as much as possible" to "Hmm, I'm working my butt off and my quality of life sucks, how do I make the same amount of business more profitable" particularly when you are married to the other half of your business and they are a price dropper and stock expander. Some people never seem to come out of that initial strategy.

    When I was last active I was and am working on that. Surprisingly, I haven't seen any drop in turnover even though I have an order minimum and pass credit card/paypal fees along to the customer. I'm targeting more high end stuff and all of this has given me more time to work on newsletters sales, fb, descriptions, etc and most importantly go fishing! It's taken my other half a fit of time to come around but he's finally seeing that the type of business we do makes a big difference, not just doing business.

    I don't know what is going to happen in the future but I'm thankful that we don't have a "big" little business and that we can downsize our expenses quickly if we have to. Being smaller gives you the ability to adjust faster so I feel as secure as I can at this point.

    Bert, I love your strategy, I'm scramble quarterly every time.

    Greg, love your new avatar :)

    Ann
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  15. Greg_M

    Greg_M Renowned Member

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    Thought it was time to update the avatar, the one I had was from about 5 years ago and made me look like a bank robber...now I just look old and unshaven.
    Cheers
  16. El Arish Tropical Exotics

    El Arish Tropical Exotics Active Member

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    It's a an emblematic representation of the times ;)
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  17. bb1

    bb1 Renowned Member

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  18. bb1

    bb1 Renowned Member

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    Must admit thats how I started off, take what ever came along.

    I quickly learnt thats not a good policy, but even if my books are full, I will still go and take a look at any new decent sounding jobs.

    2 outcomes
    • If I am not keen, I quote high and am not fussed if they don't take the quote. but if they say yes, it's at a price that I think well I am getting paid extra well.
    • If I really like the job, I quote it my normal rates, but I always have a list of jobs that I am happy to dump, and the one on the top of that least just gets a note saying sorry I am unable to service your property any longer. They may be on that list for various reasons, bad payer, just difficult to work with, or whatever. I did that just this week with one who became a bad payer. I am most likely 2 jobs over my ideal level at the moment, but decided that for the next month or 2 while we are in the unknown, I'll hang onto the next 2 on the list, but it will be bye bye if all goes well.
  19. Greg_M

    Greg_M Renowned Member

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    True, but I have to admit that "scruffy" is pretty much my standard look these days (probably always was).

    Also means I blend in with the locals, life's pretty relaxed most of the time this far from civilization, and from your new avatar seems we both have our priorities sorted :)

    One of my current gig's includes a couple of hours a week doing some software training for a local NFProfit...which equals at least one day clean shaven and a decent shirt.
  20. Greg_M

    Greg_M Renowned Member

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    A solid customer base is definitely a must and bloody hard to establish in any service business. Especially if the entry point for new players is pretty easy. Construction/building can be one of those, it certainly is in Vic.

    One thing I have to commend about SA is that you need a license even to work as a subby here (not so in Vic). Even with all my building experience I can't legally do a job here without one.

    That does seem to help put a floor under pricing.

    The client in Vic that I still work for on tender submissions is already factoring in dropping his pricing by 20% and see where it goes from there.

    He and I both have memories (haunted) of the 90's when contractors would work for less than 50% of what they were getting 6 mths earlier.

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