Abraham Lincoln once said that "Most folks are about as happy as they make up their minds to be". He could well have said this in the last month instead of over one hundred and fifty years ago!
There have certainly been many news stories focussing on the topic of happiness, for example, "Happiness is a marathon, not a sprint" - Sydney Morning Herald 9 October.
But what does this all have to do with successfully running a business? Quite a lot actually. If consumers are not feeling happy, they will cut their spending. If a business owner or management are feeling pessimistic, they will stop spending...and hiring.
It was therefore interesting to read a media release published by the Australian Bureau of Statistics last week that received widespread media publicity. Focussing on the raw number of businesses that closed in the last two years, it suggested very sad reading. But if you read the underlying statistics, the situation is definitely not as bad as the headlines suggest. Obviously the ABS wasn't thinking about the happiness of their readers!
So, does the happiness of a country's population reflect the state of its economy?
In his recent Business Review Weekly article Who's the unhappiest of them all? Phil Ruthven looked at the consumer sentiment indicators around the world.
He found that New Zealander consumers' exuberance defied their country's economic performance (having had 7 recessions since 1965). Australian consumers are also a happy lot (being happy 69% of the time since the 1960's). But we are justified having had only 3 recessions! The US consumer has only been happy 45% of the time since the 1960's (5 recessions). And the unhappiest lot?
The nation whose population has been happy for only 10% of the time since 1973 was the UK! And they have only had one recession in that time.
So perhaps consumer confidence has less to do with the economy...and more to do with the weather!
Of course, one key to happiness is to enjoy what you are doing. And if you are a business owner who dislikes administration and would much prefer to be making new sales, Part Time Professionals is here to help. We can introduce you to a CFO, Financial Controller or Accountant today who can remove your administration headaches and allow you to focus on what you prefer doing - winning more business! With over 300 members in our CFO Network throughout Australia, we can introduce you to a contractor today. Just call us on 1300 79 1946 to find out how we can make your business life happier!
On 21 October the Australian Bureau of Statistics published a media release Business Numbers Fall. Drawing upon its survey of actively traded businesses in Australia between 2007 and 2009 the headline suggested some very sad reading.
Of course the mainstream media drew heavily upon this ABS news release with articles such as ABS says GFC shuts down half a million businesses in 2007-2009 in the International Business Times.
But a closer reading of the underlying statistics, and an analysis of the previous surveys conducted by the ABS on this subject, show that the GFC was not as gloomy for business as was portrayed. For example,
1. In 2008 and 2009 (GFC) the business exit rate was 15.4% pa. In 2004 and 2005 (pre-GFC) the business exit rate was 15.2% pa and 15.4% pa.
2. In 2008 and 2009 (GFC) 548,713 businesses exited. This represented 26.4% of total Australian businesses. In 2004 and 2005 (pre-GFC) 498,229 businesses exited. This was 26.6% of total Australian businesses. Therefore the statistics show that the percentage of business exits to total businesses in Australia was lower during the GFC than it was three years earlier!
And, of course, business exits do not mean "business failures".
As the fine print in the ABS report states on page 29: "It is important to note that a business exit event does not necessarily equate to a business "failure". There may be a number of other reasons why a business exit event has occurred, including events relating to selling a business (e.g. due to an owner/operator retiring), and events relating to changes in a business's structure (e.g. due to merger or takeover activities), etc. Such events may result in one or more business exit events occurring, and in some cases, no net loss of businesses."
So, ignoring the gloomy newspaper interpretations, what can a business owner take away from these ABS figures? In summary, the survival rate for new businesses was higher where:
1. The business employed staff; and
2. The business had an annual turnover over $50,000 per annum
Most importantly, however, the survival of a business was related to the age of the business. That is, the longer a business survives, the greater its chances of continuing survival.
Part Time Professionals represents a network of over 300 qualified CFOs, Financial Controllers, Marketing, HR and other executives who can help you look behind the headlines and assist your business grow. Engaged on a contract or part time basis, our experienced professionals can assist your business without the cost of full-time employment. Give our friendly team a call on 1300 79 1946 today to discuss how Part Time Professionals can assist your business.
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EVENT AND REGISTRATION DETAILS:
An optimistic would say a glass is half full, while a pessimist would say it is half empty.
But what would people of different professions and walks of life say?
But the seasoned drinker would say that the glass doesn't have enough ice in it!
About Part Time Professionals
Part Time Professionals™ is wholly owned and operated in Australia. Our principals together have over 40 years experience in public accounting and as CFO's and Directors in multiple companies - both listed and unlisted. They are members of the Institute of Chartered Accountants in Australia, CPA Australia, the National Tax Agents Association, the Australian Institute of Company Directors, the Financial Executives Institute and the National Institute of Accountants.
Our aim is to help companies source the most experienced CFO, executive and corporate accounting talent, in the most cost-effective way!
We are constantly updating our website, so take a look at www.ptprofessionals.com.au for more information or call us on 1300 79 1946 to discuss your needs.
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