COPING IN AN AGE OF UNCERTAINTY
From the oil and gas industry, the changing retail scene, changing demography, all kinds of new technology and of course Trump in the US and One Nation and Katter in Australia, the future is uncertain. Many suggest that positive planning for the future is sensible. FoodStream can help with this planning, contact us on email@example.com.
Examples of change include:
- Trump’s rise a wake-up call for all leaders, p23, Weekend Australian 21-22 January. Local business leaders have said that the Trump election should serve as a wake-up call to CEOs and Boards to offer a better sense of purpose and direction to workers and shareholders and be more responsive to customers. Trump had tapped into a wide discontent among mainstream Americans with globalisation and the political establishment. Business Council of Australia CEO Jennifer Westacott said that many were frustrated at continued cost cutting, low wages growth and low investment by business. She said that businesses need to tap into their workers, their shareholders and workers and mobilise the importance of business as a wealth creator.
- Are the Davos elites up to the challenge, p30, Weekend Australian 14-15 January. Stephen Bartholomeusz wrote about the forthcoming Davos World Economic Forum. . He says that the challenge for the elites, at Davos or elsewhere, is to develop a consensus on how to generate more economic growth and how to better share it while looking hard at how to deal with the job changing effects of new technology.
- The Australian Industry Group’s latest CEO report released in December identified areas where Australian businesses can improve their strategic planning to lift competitiveness. The survey of 280 companies highlighted that the key to better business planning is a greater focus on innovation and global engagement. The survey found that businesses focusing more narrowly on increasing sales or developing domestic markets actually saw declining revenues. In contrast, those businesses that focused on developing new products or services or on developing new overseas markets generally saw higher increases in revenue. This highlights the importance of going beyond simply planning for growth and adopting more expansive dimensions by planning for the development of the business.
- An East Timor company joins with a Fijian company to take over an ailing Australian clothing company, as reported on p27, Weekend Australian 21-22 January. Now we get competition from East Timor! Well done for them but this shows we can take nothing for granted.
- Norway switches off but FM radio’s death greatly exaggerated, p24 Australian Financial Review 13 January. In January 2017, Norway will switch of FM broadcasting in favour of digital radio. Other nations may not be following this route. Norway was described as a thought leader. Is Australia and your company a thought leader?
- Farming for the future, p46, Australian Financial Review, 22-27 December. About 5% of the national grain crop of 1.5M tonnes was sold via AgriDigital, a new software system based on blockchain. This system allows growers, buyers and bulk handlers to manage invoices, payments and inventory all together. A 23 tonne grain transaction recently was the first physical commodity to be sold via blockchain. Blockchain is also known as ‘distributed leger’ or ‘shared ledger’. It seems that there are 25 blockchain industry consortiums around the world, most only 1-2 years old. (Blockchain??, Electronic money, sort of….)
THE CHANGING FACE OF RETAIL
The new retail offerings being planned on-line retailers may well need new kinds of food products, for novelty to attract customers as well as increased shelf life. FoodStream can assist with both aspects of new product development, contact us on firstname.lastname@example.org.
Summaries of newspaper articles follow.
Amazon to ‘destroy’ Australian retailers, p1, Australian Financial Review 4 November 2016. Amazon’s plans to expand its online operations in Australia next year may seriously affect the profits of our retailers. Amazon plans to build distribution centres and performance centres in each State in 12017. The launch may be in September 2017. Amazon plans to do fresh and general retail. In the US, Amazon has 50% of all e-commerce sales and e-commerce is expected to be 20% of all sales in the US in 10 years and by then Amazon will have 20% of all US retail sales.
Bricks and Mortar shops smarten up their acts as they brace for Amazon revolution, p25, Weekend Australian 10-11 December. Gordon Cairns, Chairman of Woolworths, is worried about the impact of Amazon’s new push into retail grocery. Some think Amazon will take up to $4B pa in grocery sales, via tools such as Amazon Echo, Amazon Dash and Amazon Tap. Amazon already has 50% of on-line sales in the US, just with CDs and books, and 24% of all retail sales growth. It is suggested Amazon’s might and power is untouchable. Cairns sees raising standards as the key to improving competitiveness. In the US, Amazon is developing a range of AI based household gadgets designed to make it easier to shop. Amazon Echo is a Bluetooth speaker that connects with music services such as Spotify, Pandora and Amazon’s own Prime Music service. It can control lights, air con, thermostats. Echo also connects with Alexa, Amazon’s cloud network, which learns your speech patterns, preferences, and vocabulary and will answer questions. It can tell you where the nearest Chinese restaurant is, order an Uber, draw up a dinner party list and order your favourite paper towels. Amazon Dot is a smaller version of Echo and Amazon Tap a portable version to take to the park or beach. Amazon Go is a new retail format where the supermarket has sensors so you just choose what you want and leave, with the sensors recording who you are from your mobile and what you bought from the sensors on products. So far, there is just one, in Seattle. Woolworths has a special group working on how to compete with Amazon. Other retailers have similar groups working on new IT based strategies. One analyst says that he thinks that Amazon will be very successful and give all our retailers, both supermarkets and others such as JB HiFi and Harvey Norman, challenges, not only re sales volumes but on price.
FoodStream’s Chris Bourne speaks at Conference in Thailand
The Institute for Thermal Processing Specialists (IFTPS) is a not-for-profit organisation which aims to bring specialists in thermal processing from around the world to ‘compare notes’.
The third South-East Asian Outreach Seminar was held in Bangkok in November by this organisations and FoodStream Engineer Chris Bourne presented for the second time. Chris’s presentation discussed his experiences with micro scale canning in the western pacific.
This project uses low value raw ingredients (typically bycatch or sizes not practical for usually processing) and low cost equipment to produce high quality canned products. The project also gives local communities the knowledge they need to safely process food as import replacement and potentially commercial applications moving forward. The safety and risks around ‘home canning’ equipment was covered in depth with encouraging results.
Other presenters were the research minds behind emerging technologies such as continuous microwave heating for aseptic products, Ohmic heating in-pack, and Microwave Assisted Thermal Processing (MATS). There were also technical staff from leading commercial, government and academic institutions worldwide.
If you have a project that would benefit from some insight in to the leading edge or best practice – get in touch. Contact Chris on email@example.com.
TAX BREAKS ON START-UPS COULD BE THE NEXT BIG THING
As part of the Federal Governments innovation policy, a range of new tax breaks has been set up for new start companies. A summary of a newspaper article on this follows. This is a complex area where sound financial and legal advice is essential. Also, the Qld Government has a range of programs to help companies do new things. With a Qld election probably due late this year, they may be keen to sign up plenty of new projects. For more information see http://advance.qld.gov.au/.
Tax breaks on start-ups could be the next big thing, p33, Weekend Australian 3-4 December. Glenda Korporaal says that now that superannuation rules have been tightened, changes in tax rules have made investing in start-ups more attractive. This new tax regime came into law on 1 July 2016 but is now only starting to be noticed. A former Citibank executive, who founded ESICHub.com, an early stage investment consultancy and investment platform, was quoted as saying that trusts, individuals, partnerships and small companies may find these new tax rules attractive. The new rules give investors more attractive after-tax returns, with a 20% tax credit for investment into an ESIC, an early stage innovation company, which is a non-refundable tax offset which can be carried forward to offset future tax bills. There is a limit of $50 000 for any one retail investor into this scheme. Qualified, ‘sophisticated’ investors are not so limited but there is a max of $200 000 in tax credits possible. Rules exist for such larger investors. For all investors there is an exception from CGT from years one to ten. Another situation where sound expert advice is essential.
UNFAIR CONTRACTS LEGISLATION
Summaries of two newspaper articles on this legislation follow. A key is that it affects smaller companies, with less than 20 employees. This is another complex area which this author barely understands so getting sound legal advice is essential.
Beginning of the end for unfair contract business, p37, Weekend Australian 12-13 November. The ACCC will be monitoring new legislation banning unfair contracts. The ACCC has analysed seven industries, advertising, telecoms, retail leasing, independent contracting, franchising and agriculture. It found those industries were riddled with unfair contracts. The key is how large companies deal with small ones. Thirteen large companies cooperated with the ACCC, but not Telstra, Woolworths and Coles. The author says that these companies are likely to have unfair contracts. In industries studied, a large number of contracts were said to have unfair clauses. He says it is the most important legislation the Turnbull Govt has passed in the business area.
Unfair Contracts legislation could be another spanner in ranks of the banks, p38, Weekend Australian 19-20 November. The November 2016 Unfair Contracts Act makes it illegal for large companies such as banks to insert clauses in contracts that give them wide powers to act against customers in tough times. Robert Gottliebsen writes that perhaps even hundreds of thousands of overdraft contracts could have to be rewritten. Several industries have been examined for the use of such contracts. Supermarkets, telecoms, franchising and banks have yet to do such searches. 8-10 million standard contracts may have to be rewritten. The Act affects contracts with companies employing less than 20 people.
Following our first Qld “Food Drying Technology” course with CSIRO in November, everything is in place for the equivalent course in Werribee on 7 & 8 March. Attendance at the Qld course was limited – especially attendees from Qld (participants came from as far away as New Zealand and South Australia) but feedback was extremely positive. However the Werribee course is filling quickly.
Preparations for our other 2017 training events are progressing, The courses are organised through Food Industry Engineering (FiE) – www.fie.com.au/events. Direct links to coming programs:
- Food Drying Technology – Victoria, 7 & 8 March 2017, CSIRO Food Innovation Werribee.
- Aquafeed Extrusion Technology, Norway, 24 to 26 April 2017 at Centre for Feed Technology (FôrTek), Ås, Norway (Part of the Norwegian University of Life Sciences).
- Food & Feed Drying Technology, Norway, 27 & 28 April 2017 at Centre for Feed Technology (FôrTek), Ås, Norway (Part of the Norwegian University of Life Sciences)
- Petfood Extrusion Technology, Norway, 1 to 3 May 2017 at Centre for Feed Technology (FôrTek), Ås, Norway (Part of the Norwegian University of Life Sciences). Webpage coming soon.
- Applied Food & Feed Extrusion, Thailand, 19 to 21 July 2017 at the Institute for Food Research & Product Development, Kasetsart University, Bangkok, Thailand.
- Food & Feed Extrusion Technology, Australia, 21 to 23 August 2017 at CSIRO Food Innovation Centre, Werribee, Victoria.
- Food Extrusion Technology, Switzerland, 27 to 29 September 2017 at HES-SO Valais-Wallis, Sion, Switzerland.
Thermal Processing/Retort Supervisors Courses – We continue to present on-site programs for companies, but interest in “public” courses has been limited. We are still considering when and where to offer the next course in Australia – to express interest contact Gordon Young on Ph +61 414 681200 or firstname.lastname@example.org.