Follwing is an edited treanscript from the most recent KPMG - ACCESS Round Table on the subject Playing The Export Game.
Jim Taggart (CHAIR): WELCOME everyone. I’d like if we could all briefly introduce ourselves to the group. We’ll start with Joe.
Joe Commisso: I’m Joe Commisso. We’re in the construction game. I handed over the reins to my son and semi-retired about 10 years ago. I then bought a farm down in a place called Beloka. I wanted to plant olive trees. In fact I planted 34,000 olive trees. I figured I needed some water to supplement my dam. Suddenly I was bottling water. So, I back out of retirement.
Jim Taggart: We’re going to come back to that story because it’s an amazing one. Lloyd?
Lloyd Gilbert: My name’s Lloyd Gilbert. I’m one of the founding members of the KPMG, Parramatta office. I’ve been here since February 2015 and it’s been an exciting ride. I go to the city often but I much prefer to be here. All the growth’s here, all the innovation, all the drive is here. And it’s so diverse. We look at industrial markets, and there are so many different types out here all genuinely putting in a lot of effort. And I think export is the next big frontier.
Cynthia Dearin: I’m Cynthia Dearin.I run Dearin & Associates and we’re an International Business Consulting firm that helps companies access opportunities in international markets. We help people to take what they do well at home and scale it up and expand it all over the world.
Jim Taggart: Dominique?
Dominique Antarakis: Dominique Antarakis. I run a business called The Copy Collective. We’ve been going nearly 10 years. I’ve just started an international business accelerator course with Cynthia. We already successfully operate in New Zealand. But we’re pushing into Hong Kong this year. We supply copy content, marketing communications for business, corporate, government, education and charity clients.
Scott Baker: Scott Baker. I’m on the board of the Cumberland Business Chamber, and I’ve also been with ANZ around 30 years. My role as a Trade and Supply Chain Manager is to enable SME businesses to understand their supply chain and understand how to protect the value of their brand within their supply chain. So, if they’re going to go into export markets, they don’t have to use four or five people to get to their end consumer. They can actually understand how to do it themselves. You might have seen some of the work that ANZ’s been doing on the web. It’s collaboration with the Export Council called a Be Trade Ready Tool. I had some input into that. That came about as recognition that bankers aren’t experts in all things export, but we know we have a wide network of subject matter experts that can deliver the right information, at the right time, to our customers when they’re in the planning phase. I use that tool whenever I’m having an export enablement conversation with customers.I use the insight that we are delivering through the tool to understand where the directors are at on their planning journey. And we also use real data and real insights from our customers about what they’ve done and what they should have done when they were planning for their big step into the marketSo, that’s pretty much what I do.
Jim Taggart: Thanks Scott. Frank?
Frank Webb: Frank Webb, Business Clarity. We’re a small coaching organisation. We’ve been around for about 15 years, coaching the SME area. Over the past three years, I’ve been working with a firm in Western Sydney, setting them up as a co-operative and I now sit as a non-Executive Director on that board. I think that there’s a lot of opportunities to come in the export market and I’m really interested to hear the comments around the table because one of the challenges is that a lot of work is being put offshore that really should be kept here. I think one of the areas where we could see huge improvement is in domestic import replacement. Export creates value but so can import replacement. And that’s an issue I’d like to raise.
Jim Taggart: Thank you, Frank. Tony?
Tony Chiefari: Tony Chiefari is my name. I work for a company called Elanor Investors. I’ve been working with them for just under two years. I’m the General Manager at Featherdale Wildlife Park. Featherdale’s been an institution in Western Sydney for 45 years. And it’s a great story. We’re taking it to the next level. Once we talk about how many people come and visit us, and internationals, and what we bring to Western Sydney, you’ll probably be surprised. So, that’s me.
Jim Taggart: Thank you, Tony. Bernie?
Bernie Fehon: Bernie Fehon. I’m the CEO of Blue Mountains Economic Enterprise. I’ve got a background in engineering design and manufacturing as well as financial planning. I’ve been a resident of Blue Mountains for over 30 years, and it’s fantastic to be working locally to attract investment and advocate for the region, and create jobs and events.
Jim Taggart: And it would be remiss of me, as my friend, to not publicly state the great work that you do, have done, continue to do, setting up the CEO Sleep Out. What has that raised? $10 million?
Bernie Fehon: Over 40 million dollars in 12 years.
Cynthia Dearin: Wow. And it’s cold in the Mountains in the middle of winter.
Jim Taggart: Thanks Bernie. Please, David?
David Hill: My name is David Hill. I’m the former President of the Parramatta Chamber of Commerce. I’ve also recently been made the CEO of an organisation called Arc. I’ve been working with Arc for 5 years – better business growth and strategy. But we’re now going into Asia. And I think this is a great opportunity to come and talk about an organisation that’s grown out of Parramatta, that’s now stretching around the world.
Jim Taggart: Congratulations on your appointment too.
David Hill: Thank you.
Jim Taggart: Schon?
Schon Condon: My name is Schon Condon. I’m a Chartered Accountant. I’ve got my own practice here in Parramatta. I began with the big boys in town. I was working for one of them when they made a near fatal mistake – one of their earlier ones. They later committed the fatal mistake. And I left there quite disillusioned and moved into Parramatta in 1988. So realistically, most others have taken a long time to catch up because I actually vehemently believed in the reality of Parramatta as the centre of Sydney back then. It is, and will remain, a powerhouse for some time to come. So, I’m in a similar vein to Frank. I’ve got some interesting experiences dealing with exports and some real concerns at the moment that we’ve got about what we’re failing to do nationally – particularly moving forward into the environment that we’re moving into.ou can see factors on the left hand which are just not supported by the relevancies and the realities on the right.
Jim Taggart: Michael?
Michael Walls: I’m Michael Walls, publisher of Western Sydney Business Access. WSBA has been around for about seven years and is currently is the only media outlet that covers the entire Western Sydney region. Thanks to everyone for coming today.
Jim Taggart: Thanks Michael, Anthony?
Anthony Bowyer: My name’s Anthony Bowyer, and I represent the Business Development for our Asia Team for KPMG in Australia. What we’ve done within the firm is decided to focus on the export story and combine all our services as package offering when talking to Australian corporates, our approach is simple to make them as successful as possible when it comes to going offshore. Many of you will know the past story around Free Trade Agreements. In fact, I was at a function recently with Andrew Robb, who’s the former Trade Minister of the country. He’s the grandfather of Free Trade Agreements and he spoke very passionately about how the opportunity for this country is now when it comes to exporting.
So our firm has put a lot of effort into working with our customers, and also prospective customers, to give them the tools and support to get into some of these markets. There’s a lot of statistics around, but just to share with you that this is the truly the Asian Century. The number of people in the region who are entering the middle consumer class, is simply staggering.
Jim Taggart: It’s critical.
Anthony Bowyer: 300 million millennials in China alone are coming online. And they’re using Smart Phones to buy products. So the impact to Australia, if we take the opportunity, will be very significant. The impact for this part of Sydney will be very important as well, for jobs and security around economic output and growth. So, the firm has decided to have a big push. My background is actually within Asia. I spent 10 years in Hong Kong and Singapore. I did developed and Emerging Market Sales. o I have a feel for what it’s like to do business there. It’s a complicated place. It’s very diverse – culturally diverse, business rules, local laws but at the same time a enourmous market opportunity.
Jim Taggart: I’ll just give you this: 300 people living in shanty towns in India will have a Smart Phone by 2022. To add to your point – what I’m saying is: There is your market.
Anthony Bowyer: That’s right.The ecosystem of transacting or banking and payments and buying and selling has been completely revolutionised. And consumers are using digital platforms in all forms to research and buy products.
Jim Taggart: That’s exactly right. I want to spend the first couple of moments looking at the different experiences around the table. Tony, tell us about Featherdale.
Tony Chiefari: It’s been around for 45 years. It started off as a hobby farm. The way it developed from there was, I believe, a few bus companies knocked on the door and said: Look, we’re taking people up to the Blue Mountains. We’d like to fill in the day. Do you mind if we get people to come in and see some animals. So that’s how it started. It’s had a number of owners over the years. Elanor Investors who are a publicly listed company – ENN, if you’re looking it up on the ASIC listing – bought Featherdale about four years ago and realised its potential.
Jim Taggart: So, you’re sole owners, are you?
Tony Chiefari: Yes, Elanor are the sole owners.
Jim Taggart: When you say commercial, you’re not talking about the land – because at one point there was a thought about selling the land?
Tony Chiefari: Correct.
Jim Taggart: But, they’ve taken a very different philosphy.
Tony Chiefari: Absolutely and without going into numbers it is an exceptionally profitable business.
Jim Taggart: How many people work there?
Tony Chiefari: There are 130 on the books but we average around 90 every week. Obviously at peak times there’d be 130 and we have 260 species with 1700 actual animals.
Cynthia Dearin: Tony, what’s the split between international visitors and domestic visitors?
Tony Chiefari: The market has changed. Five years ago, it was predominantly the Japanese, the Americans and Europeans that were coming out to Australia. It’s now all about Asia – predominantly China. India is the next big growth that is coming out. I’ll give you some numbers. These are Tourism Australia numbers – 1.2 million Chinese came out to Australia in the 2016 calendar year. 700,000 of those came to Sydney. Featherdale only got 50,000 of those. So we’ve got some opportunities to do to get more.
Anthony Bowyer: Sure. Are you marketing in Mandarin/Cantonese?
Tony Chiefari: Yes. We’ve just hired an International Trade Sales Manager – we’ve actually hired two, but one specifically to target China. Things like WeChat, without going into all of the scenarios is just going to be huge.
Jim Taggart: I’m going to come back to that. That’s got people excited, because it’s a really different model. And it’s interesting to the other types of ancillary recreational groups trying to get into Western Sydney. And you know what I’m talking about with other types of groups trying to do that.
Tony Chiefari: Yes, absolutely.
Jim Taggart: Joe, you’re an interesting person because you’d actually sold your business but you didn’t end up retiring.
Joe Commisso: I didn’t sell the business. What happened...
Jim Taggart: Or you gave it to your son.
Joe Commisso: I didn’t give it to him. I was one of the lucky Italians that was able to do a transition to hand down the reins to my son. He earnt it. I had to either let him go in competition to me or let him take over and run the company and become our partner. So I became semi retired and I bought a farm about 10 years ago because I have four grandchildren and I wanted to show them a bit of farm life. And then I decided to plant olive trees – you know – a silly Italian way of doing things. And building dams. Because I bought it during the dry period. I said: I’ll better see if there’s any water underground, so I can fill in my dam, so I can water the olive trees. And all of a sudden, 96 metres down the ground, my water expert said:, You’ve got mineral water here, buddy. You better go to an eight inch bore. Decide quickly.And so, I did that. But if everybody remembers, the water bores were embargoed. So I had exactly six months to activate this bore and get my licence and do all that, under the pressure with the GFC and all that. So looking back now, I’m a fighter. I could see the picture going forward. I’ve got quality of water. And we won a Gold Award last year after six years in the industry. Beat 104 brands worldwide.
Cynthia Dearin: Does that mean you have the best water in the world?
Joe Commisso: Yes. The very best water in the world
Cynthia Dearin: You have two water brands, don’t you?
Joe Commisso: Yes.
Joe Commisso: Natural Still I think came about eighth. So that’s going good too. I had been trying to get into China for the last six years. Finally we got our first load delivered to Shanghai. It arrived on about January 27, as a private label. And we have some big interests in Hong Kong and India.
Jim Taggart: I want to set the scene with the small experiences which have turned into really successful businesses – the visions and so on. I want to throw a clanger at you. Anthony, I’ll start with you.
Anthony Bowyer: Go for it.
Jim Taggart: Knowledge is asymmetric, which means: we get fractured information from people. That’s what we buy and sell in the market. I’m going to suggest to you that the opportunities for people to get quality is lacking at the moment.
Anthony Bowyer: And diminishing.
Jim Taggart: Well, I want to put that on the table. It’s the quality of the information that determines what we do with things. And I’m saying to you: Where do our Bright Stars go to get that quality information? And what is the quality information that people need?
Schon Condon: I’ll go one back at you.
Jim Taggart: Yes, please.
Schon Condon: What’s information?
Cynthia Dearin: Look, I’ll tell you what people say when they come to us and they start working with us. We often say: What’s the biggest hurdle that you’re facing taking a business international? And so many people have said to me: I can see there’s a huge opportunity, but I don’t know where to start. And I own a business and I run a business, but I don’t know. I can’t work out what pathway I need to follow. And I’m massively time poor. I’m already working, you know, heaps of hours every single day to keep this damn thing going. Am I really going to be able to do this? And, you know, how do I find out where that starting point is and what route I need to follow, to actually make this thing work and cut the risk right down?
Jim Taggart: OK. Let’s get more specific. Are you talking about where am I in the business cycle? Is the start-up, maturity? Like would your conversation be very different talking to Tony at Featherdale or to the owners around the Board table there, to myself with a particular application that’s got merit.
Cynthia Dearin: Absolutely. Depending on the type of business you run and what stage of the life cycle you’re at, what you need to know is going to be a little bit different.
Bernie Fehon: It’s not a lack of information. There’s an overload of information, and it’s the interpretation of that and the intelligent evaluation which is where you need experts. For example, if I want to go to Asia, in which country do I start – the one with the biggest population? Not necessarily.
Cynthia Dearin: Well, this is the thing. I’ve got a client who came to me and said: We’re thinking about going overseas and we’ve got six different markets. So, which one should we do? Maybe we can do three at once?
And I said to him: You can’t do that. You might be able to do three or six in time. But please don’t go ahead and launch into three markets at the same time. You’re going to explode. And he was like: Oh, great point. He then went through a process where he filtered down the six markets into one and then very successfully, within a period of months, went and won work with two major multinationals: Unilever and DHL. And now eight/nine months later, he’s actually setting up a strategic alliance in the market he’s gone to. But he’s done that because he’s actually followed a systematic strategy.
Schon Condon: Again, this comes back to the point I was trying to make. What is information?
To me, there are at least two components to it. One is factual technical information that you can get a book out, you can read it, and then it’s in front of you. And the other one, which I’m fearful we are in the process of removing, is experience. Now, I can wind my clock back. I left school a long time ago and came into the workforce and worked full time and studied part time. I worked in the auditors division of a firm. In between the audit seasons, I had a huge amount of spare time. And my chargeout rate per quarter hour in the year that I started was $2.75.
Cynthia Dearin: Wow.
Schon Condon: Chargeout rate – not what I got paid. So, my ability to go and do anything anywhere else within the firm was unbelievable. And the experience and the exposure I got was second to none. I could not buy that.
Cynthia Dearin: So, you took that initiative?
Schon Condon: Yes, I did. There were a number that spent the in-between time on Maroubra Beach. But I understood that the opportunity was there if I took it.
Cynthia Dearin: So, it’s really about information and the application of that information in context.
Schon Condon: Yes. At the moment, as we increasingly export “the work”, we are doing a significant disservice to everyone coming behind us.
Cynthia Dearin: So, this is offshore?
Schon Condon: Exactly.They won’t gain the experience. And increasingly, we dumb down society because it becomes rote formulas.
Bernie Fehon: We’ve used that terminology “we’ve exported the work”. It’s actually the wrong term, isn’t it? We’re now importing that work. It’s not generating export income. We’re paying overseas to important work.
Schon Condon: That’s right. And you wind the clock back to the days when this place was a colony and we could grow the best wool in the world. But for whatever reason, we were denied and prevented the ability to mill it here and convert it into fabric and do everything else.
Lloyd Gilbert: That’s right.
Schon Condon: So we sold it off.
Cynthia Dearin: To Italy. And they sent it back to us.
Schon Condon: In the 90s I had a young bloke working with me, because I also got a part time role within Defence. And my 2IC was working with one of the major tobacco companies. At that point, there was a significant oversupply of tobacco product in Australia because we could grow it like there was no tomorrow, and we were not consuming it. In fact, our consumption was in decline. At that time, he was liaising with the other members within the group. And he could have sold everything we produced to Russia at a huge profit. But because of the way the Group was structured, the existing rules were that it had to be sold into the UK at a fixed rate which was not worth doing. They could then onsell it to Russia at like 10 times what they bought it off Australia for. Ultimately they just canned growing tobacco in the country and went onto other products.
Joe Commisso: I had a similar situation where they wanted to get the local water in bulk in a container.
Jim Taggart: In a big container?
Joe Commisso: And I said: You want my water. It’s got to be bottled at site and it’s got to be exported to you. There is no way you’re going to bottle my water in China or in India. I absolutely refused. And I could have had a market just like that.
Jim Taggart: So, let’s go back. Sorry, Dominique.
Dominique Antarakis: Just in terms of going back to the fundamentals of knowledge and intelligence. I’m not entirely sure what the situation is now. But when I was at University at Macquarie, they had a very good China department. This would have been some time in the 90s. What was happening was that they were totally oversubscribed in the Economics subjects – so people wanting to learn about the Chinese economy and how to do business there... culture, language, they were scrambling. Nobody would take those courses. Nobody seemed to be interested in learning both sides of things. And to me, particularly somewhere like China which has such a long lead – the way that they approach things…. their perspective is so long. If you look at what happened with Hong Kong - they just sat there for 99 years. And then went: Oh, according to the Clause, it’s now ours. And everyone just went: Who remembers that? And it really concerned me at the time that nobody seemed to be interested in seeing the full picture. And as I say, I’m not sure where things are up to these days. But I think often we go: China’s this enormous market. There’s so much money to be made without thinking about how they they actually think. And most of us are actually not aware of that.
David Hill: Something really interesting and exciting here in Parramatta is that we can overcome a lot of the issues around cultural barriers simply by employing people from different cultures. I’ve employed a Chinese National who knows about business in China. And that’s kind of overcome that 10 year gap to get over there and get known. He’s over there negotiating on our behalf. We go with him. A lot of the cultural stuff kind of gets resolved really quickly. Now, the great thing about Parramatta is: this is where it all happens. This is where the Indians live. It’s where the Chinese live. It’s where all the difficult subcultures are. And so, if you internalise that knowledge, that’s extraordinary when you get overseas.
Cynthia Dearin: So many people don’t do that and so many people just assume they can copy/paste what works here and transplant it somewhere else and it’s all going to be perfect. And it doesn’t work.
Schon Condon: That’s one of the largest suppliers of work to the Insolvency industry because what fits here doesn’t fit there. And you’ve got to have the experience to be able to work out how to modify this standard programme to suit the particular situation.
David Hill: I think there’s one really important thing that we need to challenge ourselves around here, which is: is it the same kind of thinking now? I mean the world is changing. The fourth industrial revolution is happening. And so, it’s a different kind of openness that we have to have now. I think tenacity was what we were hearing before, and the knowledge and the skills that build up over time is part of it. But now, it’s got to be almost an openness to things that are different. So I think when you go to Asia, they’re different strategies. Like, you don’t do them the same way.
Scott Baker: We’ve actually got some hard data on this. We survey a thousand different importing and exporting customers every year.
Jim Taggart: Worldwide?
Scott Baker: No. Just in Australia. I think there are some New Zealanders in there too. The reason we do this is because we really need to drill down what the challenges and the barriers to exporting and trading internationally are.
So, the data that we came across is that the reason why 26% of active businesses got into exporting is because somebody from overseas, approached them. OK? So, simply because somebody walked in the front door and said: We want to buy your product, they decided to buy that product. Now, that’s fraught with danger because if you do that sort of thing in China – the guy that just walked in the door, if you give him a contract to be your distributor throughout the whole of China, there’s just no way that they’ve got the connections to deal with that. So, you’re just limiting yourself to whichever city or province that they have their business and political contacts in. Also, 68% of exporting businesses conduct business dealings in ASEAN. And the reason why they conduct businesses in ASEAN is largely because of the closeness in culture and the human – the people capital that they can actually access in Australia and the educational institutions that are living here and working here now.
Jim Taggart: ASEAN is south east Asia?
Scott Baker: That’s right. For example, you might not know this. But in Myanmar, which has recently opened its doors, there’s about 70% internet coverage now, and the biggest growth industry is the ITC industry. So, all of the students who are here in our universities from Myanmar are going to be engaged in that growth.
Jim Taggart: Western Sydney University has an actual subgroup of students from Myanmar, I believe.
Scott Baker: Yes. So, all of the multinationals that ANZ is supporting – like the Samsungs and the Siemens and that, that are actually driving the infrastructure and the technology growth in Myanmar – they’re all relying on students coming out of institutions like Western Sydney University.
Schon Condon: I agree. I’ve seen a number of examples of that. I’m not suggesting to you that everything is going over. But there is still an untoward quantum of it going over.
Frank Webb: Look at the improvements that are being expected through technology and they’re seeing all these improvements. The thing is that what’s happening is that the returns in efficiency aren’t following.
Frank Webb: The reason that they’re not following, not happening at the same rate, is because I think we’re focussing on the wrong thing. We’re focussing on the technology. Where the real improvement is to come from people, from interactions and the way those people work together. This is where my passion from Co-Operatives has grown over the last three years. We’ve set one up in Western Sydney which has just been phenomenal – to see the transformation that’s happened there. But there’s a process of empowerment that has to happen with those people, too, because they haven’t grown up with that process. They’re not aware of the power that comes with it. And as you say, it’s the over-emphasis on capital, as opposed to labour. We have to start recognising the true value that’s created in labour.
Jim Taggart: Frank, that’s really good. I want to come back to that because there’s an underlying comment that I was trying to make about information. David, you wanted to make a comment?
David Hill: I think it’s important that we understand how the export field is sold as an imperative. We often miss the fact that we’re doing good. And we need to connect with that. We need to provide leadership through what we do in other countries. And we need to go on the front foot with this, because often businesses are sold the idea that you’re doing it just for profit. But the brutal truth is that we’re needed over there and we’re part of what is the growth – a common growth and a common wealth on another level. And we need to connect with that and sell that.
Cynthia Dearin: One of my favourite anecdotes in that space is if you look at what Aspen Medical has done. Aspen started out as a pretty small company and they’re still not huge. They provide medical services and technology. They set up the Ambulance Service in the United Arab Emirates. They have treated Ebola throughout Africa and in Zimbabwe. They’re over in Syria with a mobile hospital at the moment. They are commercially very viable, but they’re also making a massive impact because they are taking their technology and using it to basically transform people’s lives.
Anthony Bowyer: Australia’s problem has always been proximity to market. Add to this language barriers. But that’s changing because of technology. It’s really important put in context that people can buy and sell things now through digital platforms, and it’s going to revolutionise the way in which proximity to market operates.
Jim Taggart: I still want to go back to my question. I’m wanting to talk about information, for small business as well as at your end, Tony. Where do you get that quality information?
Tony Chiefari: We work with a number of sources. I mean obviously there are authorities here. We work with Tourism Australia, Destination NSW. We get a lot of information from them. You go back to China. And I guess one of the things that I guess that tourism in Australia can’t wait for is these 300 million millennials, when they start getting confident coming out on their own. Most of us will jump on a plane, go overseas – not a problem. The present generation of Chinese visitors are not entirely confident of coming out here on their own. They like coming out here for a number of reasons They view it as a safe place. Eight or nine hours on a plane so it’s reasonably close. They love the climate. Love the people. Love the animals. In that sort of order. Hence, the stars are aligned for us. So, as these guys start travelling out on their own and can use their mobile phones and are confident of jumping on a plane and the language barrier doesn’t scare them, we’re going to see a lot more happening. But going back to your question, you need to get information from lots of sources. There’s no one place you can go to. We’ve got to deal with literally hundreds of different areas to get information.
Jim Taggart: But how do you put that through the processing to make sure you are getting quality because you don’t know what you don’t know? I hate that saying, but it’s true. The presupposition is that most people are good at their craft, but they have a blind faith in people taking them on the journey. I’m just simply trying to say that’s a very difficult part of the journey for people – and it can become very expensive. And today they say that as soon as something comes out, in 24 hours it’s either been imitated overseas or not – and in quicker time. So, if you let your guard down with IP and a whole range of stuff, you’re very vulnerable on who you trust. And the courts are littered with people like that. Where I’m coming from is: who do you go to for quality information?
Tony Chiefari: WeChat was the biggest thing. China is almost a cashless society. It’s all about WeChat. It’s their version of Facebook, Twitter – the whole lot.
David Hill: They’re much more advanced.
Tony Chiefari: Basically, 12 months ago we stumbled onto it. What the hell’s this WeChat? So we then have to go and find out about it and work with the providers over there We’re set up for WeChat because that’s how they’ll find out about us. That’s how they’ll want to pay. That’s how they’ll want to book trips. That’s the way they’ll talk about us. So, a Facebook posting won’t get to China. We need to get it through WeChat. So yeah, I don’t think there’s one place. You can’t Google it. I mean you can Google a lot of things. So, I think you’ve got to go to all the sources that are available to you. And then, when you find out about something like WeChat, you’ve got to do your research and find out more about it and invest in it.
Joe Commisso: Myself – I did it through Sydney Australia. It’s a Chinese company that I basically paid to write everything in Chinese that I put on my web page here in Australia.
Tony Chiefari: We paid our provider as well.
Jim Taggart: What gave you the confidence to do that?
Joe Commisso: I’ve got some young ladies that work in our office in the construction company, and they helped me with the water. And I got them to do it. And WeChat’s the way to go.
Following from that, my best call is not me finding them – it’s them finding me. After so many years I’ve found that, once they’ve found me, I can convert them simply because I know their style.
Cynthia Dearin: The thing is: nobody’s going to know everything. But you can find somebody who can connect you to everybody who you need to know. If you work together you can achieve a great deal more.
Joe Commisso: I find that my solution, when they say that they want to be the sole agent for Beloka Water – I say: I cannot be a sole agent in all of Australia, and I own the company! How are you going to handle all of China?
Jim Taggart: Bernie, where you are – the Blue Mountains is an amazing area – so much talent and different people there. Young, old, it doesn’t matter. The age is not relevant. But, you know, start-ups and so on. And, you know, just so exciting. What I’ve got from experience in our business is not only do you need to get that quality information but you need it in real time. I was reading some stuff on trends and the importance of collaboration. In the 60s and 70s, the business model was: it’s all my toys and I take them. You’re getting mergers and acquisitions taking place – people becoming freelancers as distinct from employees. The model of work is changing. The world is changing so quickly. So who do you go to, to get the information first and foremost?
Bernie Fehon: So Jim, that’s exactly what we do at Blue Mountains Economic Enterprise.
Jim Taggart: Please tell us about that.
Bernie Fehon: It’s about that collaboration. And it’s about clusters of industries. So, you know, before I arrived in June last year, the Board and the team before me had done an enormous amount of research to identify: Well, what are those strengths? You know, the Blue Mountains is not going to be a manufacturing centre or a heavy manufacturing centre. It’s not going to be a transport internode like Parkes is developing. But we do have a higher percentage than the state average of people in creative industries. And that’s everything from artists to jewellers through to digital creatives, animators and architects. So, we’ve developed the Mountains Made brand to give an identity to that group. And we run regular catch-ups for those people to connect and collaborate. What industry is the co-operative in which you work?
Frank Webb: Manufacturing.
Bernie Fehon: Manufacturing. We’ve got Mountains Made as the identity for a cluster of creative industries’ people, so that they can learn from each other. And what we’re endeavouring to do now is to help them and identify those that really want to grow, to create jobs. Some of them are happy to stay sole traders and there’s economic benefit in them collaborating as well. But it’s about that collaboration and sharing information to reach a common objective.
Joe, you’ve got a fantastic network you could draw from.
Joe Commisso: Yes I have.
Jim Taggart: I agree. The question for me again is really understanding to draw on those networks to get that information because it’s like surgery. You can make a wrong decision.
Joe Commisso: And you’ve got to make many of them before you get to the right one.
Jim Taggart: That’s the essence of an entrepreneur. That’s what they say. You fail many times. You’ve got to understand that.
Joe Commisso: You’ve got to follow every lead and make your own educated guess whether it’s right or wrong.
Jim Taggart: And you have to spend money on an expert, work out who is the real expert, not the pretend expert.
Joe Commisso: Well, I had an expert. The gentleman that found the water for me introduced me to a guy that was supposed to put the bottling plant together. However, he was a textbook Project Manager – not a hands-on manager. It took me a few years and a lot of money to get that rectified,. So yes, you do get caught. And you do have to spend your own money to learn.
Jim Taggart: Scott, I want to go back to you because ANZ has taken a very cultural view. And when I say “cultural”, a corporate cultural view of export drive, particularly in the Asian vicinity.
Scott Baker: We recognise that Australian exporting is not just about the resources industry, not just about digging rocks up. Most of the time we don’t own the rocks anyway. So, we built a network of branches and businesses in 34 different countries in Asia. We have the ability to service any Australian business, whether it be corporate or commercial or institutional, from any of those markets.
Jim Taggart: When you say “service”, what does that mean?
Scott Baker: If you’re in Australia or in New Zealand and an ANZ client and want to move your operations into any of the countries we’re located in, we will use our existing network to get you bedded down into that country, as far as your banking requirements are concerned. Like our offline banking offerings, we’ve also adapted our online offerings so that if you’re a CFO sitting in Sydney or Singapore or Hong Kong and you need to manage your business collectively, like manage all of the payables and receivables from the one point, our transaction banking platform actually gives you the ability to do that and link up all of your accounts no matter what ANZ geography you’re working from.
Jim Taggart: I think it’s very interesting, what you’ve done because money is the source, whether we live in a cashless society or not, the control around money, is critical.
Scott Baker: Everybody’s got a physical supply chain. And that translates to a financial supply chain as well. You’ve got to have payables and you’ve got to have receivables and you’ve got to be able to manage it.
Schon Condon: Yes. The more dynamic a platform, the more power you have in receiving credit. So, if you’ve got a platform, you can then present a better financial picture to get a spread lender to give you the capital to get more.
Scott Baker: That’s right. We found that 42% of the customers that responded to our survey who already had operations in multiple geographies were doing it with their own surplus capital. So, it’s very much that cash moves around Asia very easily. You need to have a way of grabbing it and centralising it for the benefit of the Australian business that’s in the region.
Jim Taggart: We’re going to go for a break but before we go, can I ask you Scott, do you take the ideas and help them develop them up there? Or do they have to be established as a client ?
Scott Baker: Well, they have to be an ANZ client.
Jim Taggart: No problem. My question is hypothetical: I’m not in Vietnam at the moment. I’d like to be. Are you going to take me there? I bank about $3 million a year with you. I know it’s small.
Scott Baker: What I’ll do is sit down with you and work out exactly what your plan is and how it sits with the market, and what your actual banking needs are. And then I’ll engage with our international business development team to connect you with a local banker in Vietnam. We’ve got business bankers and relationship bankers just like you’ve got here in Australia. Your relationship will be managed by the local banker here. So, they call the shots about what sort of service you need, and get it done for you up in that geography. And it’s co-ordinated because there’s different regulatory requirements in Vietnam than in Australia. It’s co-ordinated centrally through the international business development team.
Cynthia Dearin: I have to say, ANZ does a really good job on what Scott’s described. I mean I work with your international business development team. I recently referred a client to them who wants to set up in Singapore. And he’s already in touch with somebody in Singapore who’s going to help.You guys have just like taken him and put him exactly where he needs to be.
Jim Taggart: Well Cynthia, the reason I bring that back is because of what Anthony was just saying to all of us – that entrepreneurial spirit of being able to understand what the business is about, then to take it forward to understand those fundamentals like the whole thing around finance. So you should understand your balance sheet, your cash flow whether you’re exporting or not. I think that’s really critical for businesses to understand. I think we often get blindsided by saying: We’ve got to export – and yet, we take our eye off the ball with regards to those fundamentals. Alright. We’ll take a break now.
(Lunch Break)
Jim Taggart: Most people know me. I’m a bit of an entrepreneur and an opportunist. Let me put this out there and see what happens. Anthony, if one of the trends is greater collaboration, let me put this to you through KPMG and Access. Could we consider this group putting together a small delegation, say 10 to 20 people to go to Asia? I can tell you now, if we couldn’t get 10 people out of this room to go up there, I’d be really surprised. I’m only sowing the seed. But I think it would be wonderful if what we’re talking about could be led by, say KPMG.
Lloyd Gilbert: Yeah.
Jim Taggart: But what I am saying to you is I hope that that’s lit something inside of Scott to say: Gee, that’s great.
Joe Commisso: Well, you’ve got two that’ll go with the ANZ.
Cynthia Dearin: Asia’s a big place, Jim. Where are you proposing?
Anthony Bowyer: Can I just take your ideas? We talked about this internally and we’re discussing it with our partners. One of the rules that we have is if we’re going to do this, we’re going to do it as entrepreneurs at very low cost. A lot of people make mistakes when they fly up to places in Asia. They fly business class and stay at expensive places and burn a huge hole in their pocket. So, the rule for us is, if we’re going to do this, you’ve got to go low cost.
Cynthia Dearin: On point.
Scott Baker: We’ll call it Enterpreneurial Class. The most affordable and easiest way to get to the region without spending a huge amount of money.
Michael Walls: So we’re having a delegation to Vietnam, Jim? Is that what you’re saying?
Jim Taggart: Oh, I don’t care where it is, right. You know. It could be a week where, you’re in Singapore and an hour-and-a-half later, you’re in Macau. You know what I mean?
Cynthia Dearin: You bounce around.
Anthony Bowyer: It’s cheaper to travel around a region than it is to travel around Australia.
Jim Taggart: And you just go bang, bang, bang. But they put on a dinner for you in the night that’s subsidised. Everyone gets together. Handshakes.
Jim Taggart: I don’t want to assume anything. But I just think there’s something there. There’s some very significant branding in this room.
Michael Walls: I’m just curious about what is exportable and what isn’t. Do people come to you Cynthia and say: I want to export, but you look at their product and the whole thing is just not exportable at all?
Cynthia Dearin: If there’s no point of difference. If it’s a service, it’s much much easier. The cost into actually exporting a service is often much lower than exporting a good. And because the cost of creating a good here can be very very high, I think what works well in the good space, if you’re going to export, is something that you can pitch as a premium product.
So, if you would get into a race on price, and you’re exporting into China and you’re competing with product made in China which may have had the IP lifted from your product and reproduced in the factory next door, that’s not a game you want to be in. You’re never going to win that. So, it has to be something that is pitched at a premium market and has a significant point of difference. So, you have to understand when you start: what makes us good at what we do. Like, why are we already really successful. And what is it about what we do now that’s going to work where we’re going to.
Michael Walls: So, if you work with sort of entrepreneurs at the lowest level, making stuff in their backyard, mums as a hobby sort of thing – is it that level?
Cynthia Dearin: I’m not saying that we wouldn’t. But my preference is really that people have a business that’s already up and running and throwing off some cash, because to do an international expansion takes focus and energy. And if you spread yourself too thin, you end up hurting the domestic business. You might end up trashing the domestic business before you get the international one off the ground. So, if somebody was just starting out or was haemorrhaging cash and I was aware of either of those things, I would say: Not now.
Bernie Fehon: Are the opportunities more in things like exporting knowledge in aged care consulting services?
Cynthia Dearin: To be honest, the vast majority of my clients at the moment are in services.
Bernie Fehon: We’re exporting knowledge, IP. And not necessarily protected IP, but inhouse knowledge.
Cynthia Dearin: Exactly. A lot of it is how it is packaged up, because there’s a huge capacity gap, you know, in parts of the world. So I’ve spent a huge slice of my career working in the Middle East. There was a huge human capacity gap there because those economies have to move away from oil, and they know that. But they can’t do it because the local population doesn’t have the skill base to actually make that happen. So, you know, in Saudi Arabia they’re going through massive social change.
Bernie Fehon: So, what are those skills?
Cynthia Dearin: Education and training, engineering consulting, change management, marketing, publishing and content creation such as what Dominique’s company does.
Bernie Fehon: Many of those things fit into the creative industries that I talked about before that are in innovation.
Cynthia Dearin: Pop-up weddings. Look, you can make bikinis in your bedroom and run an international business. As long as you’ve got enough capital to set up a strategy where you can use DHL or Australia Post or somebody else who delivers to fulfilment, you can do it. So I mean a lot of people don’t realise they’re running an international business because they’re only doing it at home. But as soon as you start to sell to somebody who is in another country, your business becomes international. I’ll just make one last comment on this. I have a podcast called the Business Beyond Borders Podcast. And we interview successful entrepreneurs about how they took their business international. I am releasing an interview in a few weeks with a colleague of mine called Jane Jackson who is a career coach. She has consulted with more than a thousand professionals from around Asia and Australia. And we talked about this. I put to her that she had an international business. And she said: But I work in Mosman, and my office is in my apartment. Have I got an international business? And I said: Yes. If your clients are all over the place, a significant chunk of your business is coming from international business.
Lloyd Gilbert: So long as they’re paying her and the money is coming into Australia, that’s great export.
Cynthia Dearin: They’re paying that. So it’s that and she’s using technology. So she has flipped her models to maximise technology. So now, instead of having to get on a plane and go to Asia to deliver a three-day workshop which is expensive, time-consuming and leaves her feeling wrecked, she does a lot of her work in smaller pieces using a virtual platform. And the clients are equally satisfied with it. And they love the fact that it doesn’t cost as much.
So sorry, that’s a very long answer to that question.
Bernie Fehon: And to answer your question, some of the hot industries are real or potential potential growth industries – food, medtech....
Anthony Bowyer: One of those categories is infant formula and milk derivatives? . And that didn’t exist 20 years ago. In fact, it probably didn’t even exist 10 years ago. There is a significant value chain in milk from the farm to the what they call “blended and packed” And there’s probably about 40 or 50 companies that are really growing because of this food revolution. And they’ve also got money capital to expand, coming from Hong Kong and Singapore and China.
Cynthia Dearin: Don’t get me wrong. I’m not saying that you can’t export goods. Plenty of people do. But when you consider that 70% of our economy is made up of services, I think that the future trend is that you will continue to see goods being exported, especially at the higher end. But you’re going to see over time as people, you know, pick up on the technology, a real boom in how we sell our services.
Schon Condon: One of the issues in the area, though, is that we continue to fail to adequately analyse and work on sustainability. And I only picked up on these because I was actually having a conversation with somebody in the dairy industry earlier this week – a specialist adviser to the industry. The Americans have developed the production of dairy cattle to a point now where you effectively have a cow. It drops two calves in the first two years. And then you basically milk it to death over five to six years. And that gives you the maximum return for your money out of that cow.
But, suddenly everyone is starting to look, and we’re following that trend at the moment, which is really dangerous given the statements you’ve just made, is where are the animals to replace your five-year cow? Because they’re not making them.
Cynthia Dearin: No.
Schon Conodn: One of the issues for us is: I think we’ve got what, one or two refineries left in this country. And there was a ship that missed its delivery in Victoria, which put a major dent. So, I mean we’re sitting here talking about export. To put the blunt question on the table: how much fuel is in the country? How long can we survive as a country without a delivery of fuel?
Scot Baker: Two 2 weeks. And if there’s a war, a shorter period of time.
Schon Condon: It’s 2 days because Defence will claim virtually everything that’s there now.
Joe Commisso: I want to say something about how I solved my market strategy. When I was giving samples away, everybody was taking them, but there was never any callback. When I put the what’s-a-name in place about 12 months ago: You buy the samples – and I’ll give you credit on your first order – that’s when you found the men from the boys. And it’s worked. So, for anybody that’s doing some export, let them pay for the sample, let them do their market strategy, and then on their first order give them a credit on what they initially bought.
Jim Taggart: Thank you for that. You’ve just been instigated and brought into the Board for Western Sydney Export Corporation. What are you going to do? Bernie, what are the challenges you face?
Bernie Fehon: The challenge that we’re facing is: how do we create value in the Western Sydney economy? At the moment, one of the things that we’re doing is we’re exporting jobs.
Jim Taggart: What does that mean? Let me ask you this question. Are you saying we don’t have an export plan for Western Sydney?
Frank Webb: We do have an export plan for Western Sydney. But there is also an opportunity for import replacements, because there are things that we’re importing into Western Sdney that we could perhaps manufacture. And there’s a double-edged sword in this. It’s: chase the lowest cost. Because the costs that we pay in Australia are to support our social structure. They’re to support our standard of living. And if we keep chasing the lowest cost producer, what we’re doing is we’re not valuing all of those great things that we have. We’ve got a great climate, a safe environment. We’ve got, reasonably good infrastructure.
Jim Taggart: So, is the narrative wrong?
Cynthia Dearin: I don’t think you’re going to change the way that things are. I mean, as you’ve said, there are two sides to the picture. On one side there is greater opportunity to do something internationally, irrespective of the size of your company, because the barriers to entry are so much lower than they’ve ever been. There are three to four billion new customers out there. So more than 95% of the people that you can sell your stuff to don’t live here. So you’ve got a massive opportunity. The dark side of that is that with new level of education and wealth all over the rest of the world allows people to become your competitors as well. So when you sit here in Australia and continue to do the same thing, sooner or later other people are going to come in and take your market share. If you’re a retailer you’re already experiencing that. Amazon is here. Myer’s going down the tube. David Jones is, you know, pretty much going down the tube too because these companies have not looked outside and thought about what’s happening. They’re having a Kodak moment. So, the way that I see it is: you have to get on the front foot and you have to work out: how are you going to deal with the fact that other people can also, cross these barriers for entry, come to Australia, say: Hey, this is a great place. We can breathe the air here. We love the climate. It’s safe. We’re going to set up here. We can’t stop those people from doing that – whether it’s physically or whether they import their stuff digitally. And we need to think: how do we address that problem?
Bernie Fehon: So, it’s a continual problem – an ongoing problem?
Cynthia Dearin: It’s not going away.
Bernie Fehon: It’s playing to your strengths now, which will be different to what your strengths are in two years time, compared to a developing marketplace. So, it’s constant innovation.
Cynthia Dearin: Absolutely. Innovation and moving forward. The best defence – what is it? The best defence is offence.
Schon Condon: You made a statement about DJs and Myer. That they had a Kodak moment.
Cynthia Dearin: Yeah.
Schon Condon: I’d like to correct that because, in failing businesses, a lot of people fail to actually look at the genuine underlying factor. Now, I would suggest to you that the problem for Myer and David Jones is a failure to evolve properly.
Cynthia Dearin: Is that not what Kodak faced?
Schon Condon: No. Kodak was catatonic. Kodak had an Andersen’s moment. Kodak developed digital photography.
Cynthia Dearin: Yes, it did.
Schon Condon: And it said: There is no future in this, because the money is made out of selling paper. So, they sold that technology.
Cynthia Dearin: They didn’t understand what problem they were really solving.
Schon Condon: To Panasonic, I think. One of the Japanese companies. That’s a Kodak moment. That’s where you own the genius. You’ve got it. You self developed it. You create it.
Cynthia Dearin: I was really making a more general point which is that they haven’t stayed relevant.
Schon Condon: In a sense.
Scott Baker: But the point there is about innovation and about understanding your customer, asking that question: what business are we really in? and constantly being client-centric.
Schon Condon: Two ends of that: if you go to a museum in Melbourne, there is a box in a big glass cabinet with a letter on the back wall from the Australian Government that actually states there is no future viability – great idea, but there is no future viability of this product. There sits the original black box flight recorder – in Melbourne.
Jim Taggart: I want to come back to the idea of data. Today, a new Bill comes into Parliament with regards to the integrity and privacy of data for companies over $3 million. It’s very interesting with regards to the notion that who owns the data owns the game.
And we were talking yesterday about how algorithms and algorithmic movements in data can really give you a thing. But anyway, the interesting thing I’m coming back to is: what are the issues facing Western Sydney? We’re not good enough. There you are. I’ll put that on the table.
Scott Baker: Well, Western Sydney is an industrial powerhouse. But it’s an industrial powerhouse still full of mum and dad baby boomer businesses that haven’t evolved with their market. So, there’s lots of manufacturing functions which could be performed in Western Sydney that are now performed overseas.
Jim Taggart: For example?
Scott Baker: I have a customer that makes bottled water. They sell it to Woolworths.
So the plastic bottles, like that you buy in Woolworths and Aldi and all of that – do you know where the plastic for the bottles actually comes from? You’d think it’s recycled through the Return and Earn programme, wouldn’t you? It doesn’t. The plastic billets come from India. And then they’re blow moulded. And then they’re sold out to the retail distribution networks who charge you a premium. And then they probably make more money than it ever costs the programme to be run. But, the recyclable material is not recycled in Australia. It’s recycled somewhere else. So, what a waste of shipping time and fuel that is. It’s a way to backfill a ship. That’s where it comes from.
Joe Commisso: No. You’re quite right there. You can actually ship across a container to China for about $400. Because it goes back empty, you see. So therefore – if it goes full, it’s cheaper
Schon Condon: Going back to the 90s I had a Chinese client who had moved out of the Northern end of China not long before. They migrated out to Australia. and did all the right things. Started basic. And had done reasonably well out here. So, they bought a box of oranges and sent it home to the family for Christmas, which they shared around their little village. And everyone was blown away. So, the village raised enough money to send it out to here, to get them to buy a whole lot of produce that was going to survive – mainly oranges – and ship it back. So, this bloke ended up buying a container of oranges to send back for the village in China. The container made it as far as the wharves in Sydney. And it got stopped. And it sat there for three-and-a-half months while the fruit rotted. And then he turned up on my doorstep bankrupt.
Now, why did he turn up on my doorstep bankrupt? Why did it get stopped? The Australian Government stopped it. Because the oranges being sent overseas were not export quality. The fact that it was a private thing was completely irrelevant. But it took them three months to sort out that it was approved to go, and he went bankrupt.
Jim Taggart: Thank you for that. I want to raise this. Are we doing enough in Western Sydney to grow international business? We’ve got Badgerys Creek. We’ve got Marsden Park. We’ve got Bella Vista which is a serviced base. We’ve got Riverstone, Hawkesbury, the Blue Mountains and a whole area of Blacktown now developing. Do you believe that there is an underlying strategy at the macro level that incorporates that? Or, is it still disengaged?
Anthony Bowyer: That’s a huge opportunity.And anyone who’s been to a supermarket in mainland China or in developed cities and then come back and gone to Coles or Woolies or Harris Farm, there is a mile of difference between the quality we have and the quality they have.
Jim Taggart: So you’re suggesting that one of the key opportunities over the next 10 years is high-quality premium foods?
Schon Condon: Absolutely.
Anthony Bowyer: Grown, processed here, packaged, ready for sale.
Schon Condon: They have the financial power to pay a premium for the product. In fact, you know, in Singapore for example I mean the average income is very high. It’s one of the highest in the world.
Anthony Bowyer: They don’t grow food.
Schon Condon: They don’t. I mean there’s a whole load of myths that’s floating around on the web at the moment. I want to come back to a fundamental basis because I’m supporting the whole construct of the export – everything else – without doubt. We grow 500 tonnes of food – 5 million tonnes – it doesn’t matter. We grow 500 tonnes of food. And we as a nation consume 450 tonnes of that. And we sell it overseas. If we suddenly say: There are all these lucrative markets. We can get better returns. And we sell 450 tonnes overseas and we’ve only got 50 tonnes left, - what is the benefit back to us?
Schon Condon: What’s our sustainability? Are we going to import in? And then, what’s the quality like? Where’s the sustainability? What I’m getting at is: how are we going to double the quantum coming out of the farm? I’m not an expert but creation in farming has been around for a long time. And I’m confident that entrepreneurial people in the space will figure out how to get more and figure out how to do it more efficiently.
Joe Commisso: The problem you’ve got in Australia is that labour is very expensive. So therefore what you’ve got is Australian farmers here that are burying the vegetables because they can’t get the right price.
Schon Condon: But that takes you back to my Chinese friend. It’s the government who turned around and says: We can’t
Joe Commisso: Yes. But if the Chinese came here and they’re going to plant vegetables, they’ve got to pay the correct wages, if the government’s doing their job, like I do.
Schon Condon: Not necessarily.
Jim Taggart: I appreciate the dialogue but I’ll go back to my question. Do we have a plan for Western Sydney?
Michael Walls: What sort of plan do you want?
Jim Taggart: Well, I don’t mind.
Frank Webb: The level of thinking has to change in business. I’m off to England and to Spain, to go over there and talk to Brexie and talk to Mondrag about co-ops and the way they’ve structured them. In the space of 50 years, they’ve grown a conglomerate over there of 231 companies that employ something like 14,000 people. This is a very small region in Spain. The stuff that’s grown there is just absolutely phenomenal.
Joe Commisso: Italy does the same thing, too. Little farms just bring it all there.
Frank Webb: And they’ve got laws in Italy about the formation of co-operatives.
Frank Webb: The way you value labour as opposed to capital. We put a huge value on capital and a very small value on labour. But labour is seen as our highest cost. Why is it seen as our highest cost? Because capital within the community attracts such a high dollar value out of earned wages. So, this is where we’ve got to look at a long-term strategy for Western Sydney.
Jim Taggart: Well, the reason I ask that is because there was a very big push in the 80s and 90s for Sisters of City.
Many: Sister Cities?
Jim Taggart: Sister Cities – as a tool, as a process, as an avenue to promote and develop economy and social harmony and all of that type of stuff. That’s kind of died for a whole range of reasons.
I’m trying to ask, what is it out there that is getting people excited about exporting in Western Sydney?
Michael Walls: There’s no Western Sydney brand, Jim. It’s not like “Made in the Mountains”. And I don’t know if the external world outside of this region we call Western Sydney cares that much.
Cynthia Dearin: I think the big challenge here is it’s a question of mindset. If people are not aware of the opportunities and they’re so busy just going around in their little tiny market of 25 million people and they don’t actually appreciate what opportunity is out there, and they’re not excited about the impact that they could make for the better with what they do, they’re not going to do it.
Anthony Bowyer: But that’s why these discussions are really important – to get people thinking of the opportunities.
Now, I haven’t lived in this country for almost 20 years. But I can guarantee you there are some food manufacturers in the base of Western Sydney that are would-be world class.
Cynthia Dearin: I don’t doubt it.
Anthony Bowyer: The top 1% by world standards. Now, we need to find those companies. We need to sit down and talk to them and say: Right. How do we get your product onto the supermarket shelves in Asia?
Jim Taggart: And that’s where I was coming from when I ask the question about information being asymmetric, or being fragmented. and I think people will all nod their head if I said to something like: How do you feel today? All good. That’s great. But I’m not sure if we really are experienced over the sum total of that. And I’m saying, for example, where is Featherdale going? Yes, they’re focussed on what they’re doing there but, are they going to move to the Hawkesbury? Are they going to go up to the Blue Mountains? Where is the dialogue that’s going there? And ski parks – what impact will that have on Featherdale, on Wet ‘N Wild?
Tony Chiefari: From a tourism market, people don’t know about Western Sydney. And, it’s too far. I mean, you know, 40 minutes is too far. That’s our challenge. Now, obviously we’re lucky we’ve got the Blue Mountains and that’s where we get other people. We deal with 400 tour operators that bring people from the City into Featherdale.
Jim Taggart: That’s staggering.
Tony Chiefari: Now, the problem is that one day the tour operators might do the Mountains, they might do us, they might do one of these farms that you’re talking about – and there’s more of that happening. Then you’ve got the tour groups that’ll go up to Port Stephens and might do a winery. The thing is, people don’t know about Western Sydney. There’s no Harbour Bridge. No Opera House. You know what I mean? There’s no water. So, why come out to Western Sydney when you are on limited time? So, it’s a matter of drawing people into Western Sydney. All of these things, we work as a cluster. I mean we’ve recently teamed up with Wet ‘N Wild to sell annual passes and those sort of things.
Jim Taggart: There’s collaboration.
Tony Chiefari: Exactly right.
Anthony Bowyer:But there are a range of organisations looking at the visitor economy in Western Sydney. I think at the moment there is work being done on it.
Tony Chiefari: Exactly. There’s a number of people who have been talking about it for a long time. But look, most people don’t know about anything over the Anzac Bridge. Seriously. They just don’t know. They just think it’s a wasteland out here.
Jim Taggart: So, who should be driving that? The government, or is it going to be private industry?
Tony Chiefari: From a tourism point of view, you know, Destination NSW, Tourism Australia have a lot of work to do. And I think they’ve started forming things where they’ll support regional centres and businesses in Western Sydney to help attract tourism. But they’ve got to – because I mean all you ever see overseas is the Harbour Bridge, the Opera House and a koala.
Jim Taggart: Manly Beach or Bondi.
Tony Chiefari: And the Three Sisters. If we didn’t have the Three Sisters, it’d be a lot worse.
Bernie Fehon: There’s currently over three million tourism visitors to the Blue Mountains each year.
Cynthia Dearin: How many?
Bernie Fehon: Over three million a year. That’s been up about around three million to four million over recent years. And that’s export income. So, we need to embrace that. But then Western Sydney, where the bulk of the people are, I guess, need to capitalise on that as well. In the Blue Mountains Destination Management Plan they identified that a larger scale hotel with a conference facility, for example, in the Upper Mountains is a sensible thing to do, and there would be demand for it.
Michael Walls: Of those three million, how many are international, coming from foreign countries?
Bernie Fehon: Around 60% I think. But we do have a lot of day visitors, as the backyard to Sydney.
Michael Walls: So Western Sydney would be an important catchment area for the market?
Bernie Fehon: Absolutely.
Michael Walls: We’ve had MPs in these sessions and the sentyiment was that basically governments really doesn’t know anything. It really comes down to people like us putting the idea and the philosophy together. Governments have money. And you need money to stimulate a new idea.
Scott Baker: And what we’re seeing today in our economy is the result of decisions that were made 5 years ago. Right? Governments run things on a three year cycle, and it gets really frustrating because you’ve got all these really fantastic reports written. When you get to the end of the three year cycle, those reports get all shelved because that was the last government. And now, let’s go on with this.
Jim Taggarty: Another tangent.
Scott Baker: Another tangent. And we’ve got to move the level of thinking. We’re talking about, you know, business owners who are saying: Oh, business owners have to lift their level of thinking. Our governments have to lift their level of thinking and start to think strategically. If business owners have to think strategically. Why not them? How do we get them to do that? Through pressure groups, through Chambers of Commerce, through groups like this. In Japan, they have a 100 year policy for the development of infrastructure and rail systems. And they drill holes through mountains in earthquake prone areas – and we can’t put a VFT in? Why not? Oh because that will take a lot of money out of the airports, because they won’t have the people. Hang on. Who are we looking after here? Vested interest groups? Or are we looking after the economy?
Scott Baker: Well, why do you build a road under a road, and then shut half the road that was there in the first place to force a funnelling thing underneath it? It’s what we do in this country. I mean we bleed everyone in Western Sydney to death on tolls.
Several: Yes.
Scott Baker: And then watch other people bank millions of dollars, because the government will say: Oh, we can’t do that because we’re a government. So we’ll do it in a private/government enterprise. So, what happens? Capitalise the profits, socialise the losses. And society pays.
Jim Taggart: Just one point. Sorry Scott.
Scott Baker: If you want to treat Germany as the model – they don’t have a huge conglomerate as such for example. And I’m not suggesting Hamburg’s a small place. But there are towns around Germany that are experts in the field.
Jim Taggart: I want to hone in on it, because that’s really the theme that I’ve been trying to drive. I hear really good comments about exporting and adding to GDP, $120 billion economy Western Sydney is, third largest – you know – bigger than this, and all that stuff. I hear it nearly every week. But when you drill down and look at the real structure that underlines it, I don’t see that as being really planned like in Europe, what they’re doing with industrial hubs with technology hubs and so on, where they’re actually giving great incentives. In Romania and places like that, they actually give tax incentives for three years and so on, to just go and work, build it up, give people jobs.
Jim Taggart: And I’m going to leave that on the thought. I’m always very respectful of time. I think the dialogue has got us thinking about some important points. I’m going to shoot to Lloyd, to summarise on behalf of KPMG, and also to Anthony to conclude. Can I just formally say, on behalf of Access, thank you. I can’t believe two hours have gone so quickly. But the dialogue has been very positive. I think there’s been some really interesting thinking and meeting of people. So, well done guys.
Joe Commisso: And one great thing: it wasn’t boring.
Lloyd Gilbert: This is really interesting. I think there’s a real level of consciousness rising about this. What I said to some people before – you know – we did some seminars for Blacktown City Council and the penny dropped that there was this whole deregulation of the economy, you know, with Keating and all those guys 20 years ago or whatever it was. And there was no push the other way. And we need pockets and pilots of things to start happening. But, you know, I think the intelligence is in this room. And I think there’s a vitality about this. The Jobs Action Plan has a line on it that says: Export, to create jobs. But that’s as far as government goes. But we have an excess of technical talent, natural resources, all sorts of things. And we just need to raise that consciousness higher so that people’s fear is reduced. If you go to someone who wants to export, they want to say: Do I have an attractive product – No: 1. Are their buyers out there, really? What is my investment, so I can actually plan for that? And, when can I expect to see a return? If you can answer those 4 questions, people would say: OK. I’m going to give it a go, and we’ll try and get some funding to at least jump over those hurdles to make something happen.
Jim Taggart: That’s a good summary. Anthony?
Anthony Bowyer: I think it’s been a good robust discussion and these forums are important to not only do once but also to repeat and let’s make the voice heard in this area – a very important area of Sydney but also a very important area for the country. Let’s make it heard. I lived in Asia a long time and I can tell you for sure – my wife’s Chinese Australian – this is the best country. It’s got the most exciting opportunities ahead of it. Everyone wants to come and live here. I met people – Singaporeans, Malays – they would say to me: You are the luckiest person because of your country. And the other thing is economic power. There’s nothing worse than recession. Many people in this room would remember the 1990 recession.
Anthony Bowyer:
Jim Taggart: And I’ll put this on the table, but don’t hold me to it. I’d be happy to contact Minister Kean who I know pretty well. I was really impressed, with his presentation. I’d like to try and formulate something like that for you. I know enough of him, and I’d like to see what we can do.
Bernie Fehon: So Jim, if we do a regional conference – and I’m talking in the Blue Mountains – we might be able to get Destination NSW meeting the NSW programme to help support a symposium, a conference.
Jim Taggart: Bernie, I appreciate that because that’s what I’m trying to say here: put the cards on the table, so lights go on with people and say: Oh, I’ve got to contact that person, got to do that, I like that. And that’s what I’m saying: the whole concept behind this is being led by KPMG. They’re powerhouses.
Jim Taggart: Guys, thank you. Have a great day. I really appreciate it. Can we all stay in touch in some way? And I’d love to see that delegation go. Put that on the table. Thanks again everyone for coming and sharing your ideas and your wealth of knowledge.
