Tough Times Ahead

[cobramania]

I think without a doubt, it's going to be tough times ahead for the entire automotive industry (among others).

Over the past 6 months or so, 3? Ford dealers have closed in Sydney alone, with another one going in the next month, other brand dealers have gone too.

Also with Ford shuting up shop in 2016 if not before, & I'd say Holden won't be far behind, with Toyota following.

Only the strong will survive, but as we've seen, the marketplace has taken it's toll on even the biggest of companies, Ford & GM, so it's going to be near impossible for the little guys to survive unscathed.

Yesterday afternoon a mate of mine walked away from his Smash Repair business of around 30 years. He was a few months behind on rent of his workshop, & cash flow has been tight for some time, but he was trying to trade out of it.

Yesterday it all became too much, & he collected up a few hand tools, took a few customer cars who's jobs were almost finished, shut the doors & walked away.
Leaving the rest of the tools, paints, some parts, 3 or 4 hoists, the spray booth, 2 large diesel generators, & about 5 personal project cars in various states of repair/restoration, for the landlord to sell off & recover the rent + make any profit he wants from the sale.
He'll finish off the customer cars himself using another workshop & payup any small creditors with the last of the insurance payments from the customers, then walk away empty handed.

I'm not sure if he's taken his Variety Club Bash car or left it?
He competes in the Variety Club Bash every year & has done so for about 10 years now. Even if he's kept the car, I doubt he'll have enough money to compete next year, so a very good charitable cause has also lost funds/donations & become a innocent victim.

About 8 other staff will/have lost their jobs as a result. Not good this close to Christmas, but there was nothing else he could do, with costs rising, insurance companies screwing repair prices down, often to below cost so corners have to be cut. Everyones losing out here & no one will win in the end.

Unfortunately I predict come 2017 Aus will be in a major recession, with many out of work, little money around to spend, with the auto industry being just the start, & there's little the current government can do to avoid it.

In my industry also, (Air Conditioning), in the Sydney, Central Coast & Hunter areas, I know of at least 25 A/C installation companies who've shut up shop in the last 3 months with more to come at the end of this summer season (around March/April). Some of the older guys have retired early, younger ones are looking to move on to elsewhere (another industry). My own boss is very seriously (almost confirmed) to be giving it away & retiring at the end of the season.

[mechanic]

I'd be interested in hearing the possible reasons for this scenario.
Several people in the past few weeks have stated similiar opinions to me.

[Franco Cozzo]

A workshop a mate is working at (Auto electrical business), work is the slowest its been since the 1990s when they started.

People just aren't taking their cars in for work at the moment, odd.

We've got lots of work on but accounts on stop everywhere.

[Agile]

Jeez. I was thinking NSW was the best performing state, besides WA. Sad. Here in SA the domestic building industry is at its lowest in thirty years. Every subby is flat out undercutting the next bloke to just get some work which means there is no, and I mean NO fat left in the pricing. When I win a job it is on pay rates of 5 years ago, and falling.My personal income is HALF !! of what it was last year and last year was 30% down on two years ago. We have worked on average 3 days a week this year. Which means not one dollar is being spent where it doesn't need to be spent and that situation just rolls on through the economy. Forget what the pollies tell you, we are in a recession now. Somehow it just doesn't come out in the stats.

Oh, and SA is FLAT BROKE !!!! Worse than when we experienced the State Bank Disaster. Next 5 years look pretty bleak. Save what doe you can if you are a " little guy".

[nstg8a]

I work in transport/warehousing and we are busy as, the boss has turned away new clients in the last few months.

We've just taken on Costco as a client, my god they are doing nothing for the local economy unless its cheaper than overseas suppliers.

The entire shop fit out is coming to us in containers from Asia, virtually nothing will be sourced locally.

[prydey]

disposable income is tight. some things that were once routine, or normal, are now luxuries that slide down the priority list.

there are many industries that don't make the news. my industry (printing) is also on the slide. we were undercut on a job by $5000 by china. that included flying the client over there to view the job on the press, and shipping. how can you compete with that. its not like the equipment or paper is different.

there just isn't a lot of money changing hands in general at the moment.

[TC200six]

Originally Posted by Big Damo

A workshop a mate is working at (Auto electrical business), work is the slowest its been since the 1990s when they started.

People just aren't taking their cars in for work at the moment, odd.

We've got lots of work on but accounts on stop everywhere.

I know a mobile EFI specialist that garages use and he was saying that some workshops are having days with no work booked in during the last few weeks. It's not just automotive, the owner of a cafe near where I live says business last year was the slowest in all the 10 years he's been there and has reduced business hours because of it.

[Rodge]

& about 5 personal project cars in various states of repair/restoration...

That bit stood out like a sore thumb. A reasonable percentage of small business owners indulge their passion(s) more than is sometimes in their best interests.
I know of one small local panelbeating business where the owner spends over $60,000 per annum racing rally cars, then complains that times are tight and gives his few staff Jack Shyte in the way of a Christmas bonus. Some of the inefficiencies I see as an accountant with small business's really amaze me. People making $150,000 per annum and claim they're flat broke and can't afford to pay their tax More often than people would imagine, a business owner can be really good at what it is they do for a business and completly hopeless managing their finances.

I wonder how many of these business owners are sucking out large monthly drawings to pay for their jumbo house mortgages ?

[Bluehoon]

It's a bigger problem than realised.
At work we're coming into the busiest time of the year and we're not even starting to see signs of life let alone getting busy.

It's a worry and appears to be across many sectors. Consumer spending is at a stand still and in effort to start it, everything keeps getting outsourced to drop the price.

It's unsustainable and we're in for a reality check. Clear out your debts and work on a cash only basis - we're headed for tough times.

[stevz]

I think our ridiculously overcooked property market is to blame for a lot of this. When people need to mortgage themselves up to the tune of $600,000 for an average suburban home, it's obvious that there isn't going to be much disposable income left after servicing the mortgage payments.
Yet here we have again all the headlines screaming 'property boom' and people falling over themselves to pay ridiculously inflated prices - can people really be that stupid?
I personally believe that this country is headed for one hell of a major recession and with it will collapse the property market. There will be a lot of people in negative equity when this happens and only then will they start to see what pain really is. It's only a matter of when, not if...mark my words.

[roberts]

Originally Posted by stevz

I think our ridiculously overcooked property market is to blame for a lot of this. When people need to mortgage themselves up to the tune of $600,000 for an average suburban home, it's obvious that there isn't going to be much disposable income left after servicing the mortgage payments.
Yet here we have again all the headlines screaming 'property boom' and people falling over themselves to pay ridiculously inflated prices - can people really be that stupid?
I personally believe that this country is headed for one hell of a major recession and with it will collapse the property market. There will be a lot of people in negative equity when this happens and only then will they start to see what pain really is. It's only a matter of when, not if...mark my words.

until somebody address the elephant in the room, which is negative gearing things will only get worst. I believe in 1987 was the last advertised change to this middle class welfare system and it was quickly shot down by the real estate industry makes sense for them to protect there interests, so whilst saving the exorbitant deposit for a home people aren't spending money in the rest of the economy, the higher houses go the more that needs to be saved. The only people that win from this are the real estate industry and the banking industry, it does serve as a carrot to keep people employed but if your only in a job to pay the mortgage how efficient will you be if you are unhappy and trapped in the position. Houses are overvalued by 60%, it is one big asset bubble that is only being fueled by lower interest rates and will continue till interest rates are at 0%, when rates start to go up pop goes the dream.

[mr smith]

Originally Posted by stevz

Yet here we have again all the headlines screaming 'property boom' and people falling over themselves to pay ridiculously inflated prices - can people really be that stupid?
I.

The punters are that stupid.

That said a mate in the industry was telling me that a massive amount of the properties for sale are under bank instructions but not advertised as such because they fear it will scare the public if they know the true sentiment out there.
I feel the media are at it again to cash in. Any guess what the biggest earners are in the paper world, the real estate section.
Lots of money to be made selling advertising space boosted by a "boom"

[roberts]

Originally Posted by mr smith

The punters are that stupid.

That said a mate in the industry was telling me that a massive amount of the properties for sale are under bank instructions but not advertised as such because they fear it will scare the public if they know the true sentiment out there.
I feel the media are at it again to cash in. Any guess what the biggest earners are in the paper world, the real estate section.
Lots of money to be made selling advertising space boosted by a "boom"

this doesnt surprise me, the bank never losses. If they keep churning punters through mortgages and they default its either covered by mortgage lenders insurance or the bad debt gets moved to a debt collector, i would be suprised if a bank every shows a loss.

[prydey]

Originally Posted by stevz

I think our ridiculously overcooked property market is to blame for a lot of this. When people need to mortgage themselves up to the tune of $600,000 for an average suburban home,

to a point. people don't have to buy or spend that sort of coin. too many people want to start out life where their parents are currently at. you know, nice house, nice car, lots of luxuries, hobbies etc etc. no one wants to leave home and buy a house within their means that looks like a run down shanty. everyone wants to have it now.

well, now, its starting to take its toll and many are feeling the pinch. overtime dries up so those that rely on it start to point fingers at the economy or inflation etc. cost of living goes up, rates go up etc etc, but because so many are living so close to their limit, or beyond their limit, it impacts hard.

once companies start dropping prices in a bid to maintain volume, its a race to the bottom. its not sustainable.

[roberts]

Originally Posted by prydey

to a point. people don't have to buy or spend that sort of coin. too many people want to start out life where their parents are currently at. you know, nice house, nice car, lots of luxuries, hobbies etc etc. no one wants to leave home and buy a house within their means that looks like a run down shanty. everyone wants to have it now.

well, now, its starting to take its toll and many are feeling the pinch. overtime dries up so those that rely on it start to point fingers at the economy or inflation etc. cost of living goes up, rates go up etc etc, but because so many are living so close to their limit, or beyond their limit, it impacts hard.

once companies start dropping prices in a bid to maintain volume, its a race to the bottom. its not sustainable.

you are correct, but the thing is most of the run down shanties get snapped up by investor looking to flip it and make a quick buck, they don't care about condition because they never live there. Its hard to buy a run down place move in then start doing the repairs it is possible but hard, most of the derelict houses go to auction, so you bidding against people that have negative gearing in the back pocket and other assets, that will out bid just because they can.

[GASWAGON]

Originally Posted by stevz

I think our ridiculously overcooked property market is to blame for a lot of this. When people need to mortgage themselves up to the tune of $600,000 for an average suburban home, it's obvious that there isn't going to be much disposable income left after servicing the mortgage payments.
Yet here we have again all the headlines screaming 'property boom' and people falling over themselves to pay ridiculously inflated prices - can people really be that stupid?
I personally believe that this country is headed for one hell of a major recession and with it will collapse the property market. There will be a lot of people in negative equity when this happens and only then will they start to see what pain really is. It's only a matter of when, not if...mark my words.

Without going into the nitty gritty's of it......This IS the main problem....The previous governments and banks allowed this RE bubble to happen and now everyone else is paying for it.

I REALLY feel sorry for gen y's trying to get into the market...Its just not feasable at present prices......A major correction is due!

[stevz]

Originally Posted by EF_6

Without going into the nitty gritty's of it......This IS the main problem....The previous governments and banks allowed this RE bubble to happen and now everyone else is paying for it.

I REALLY feel sorry for gen y's trying to get into the market...Its just not feasable at present prices......A major correction is due!

Agreed. What we need at the very minimum is the abolition of negative gearing and a ban on non-citizens purchasing property.
Housing is a basic necessity and should not be used as a vehicle for greedy investors. That's what the share market is for.

[Gadgetman]

Originally Posted by stevz

I think our ridiculously overcooked property market is to blame for a lot of this. When people need to mortgage themselves up to the tune of $600,000 for an average suburban home, it's obvious that there isn't going to be much disposable income left after servicing the mortgage payments.
Yet here we have again all the headlines screaming 'property boom' and people falling over themselves to pay ridiculously inflated prices - can people really be that stupid?
I personally believe that this country is headed for one hell of a major recession and with it will collapse the property market. There will be a lot of people in negative equity when this happens and only then will they start to see what pain really is. It's only a matter of when, not if...mark my words.

Yeah agree. but the flip side to the property market issue is lots of home owners that have bought 10 years or so ago have lots of equity and access to the lowest interest rates in history. If they choose to buy a car with that superlow interest rate, they will also buy it cheaper than what that product was 10 years ago thanks to greater competition.

[stevz]

Originally Posted by Gadgetman

Yeah agree. but the flip side to the property market issue is lots of home owners that have bought 10 years or so ago have lots of equity and access to the lowest interest rates in history. If they choose to buy a car with that superlow interest rate, they will also buy it cheaper than what that product was 10 years ago thanks to greater competition.

Yes but what happens to this equity when property values crash back down to earth? Those who were silly enough to blow it on cars and other luxury items will be in a bit of a pickle...

The Australian housing market would have to be the biggest ponzi scheme ever known to man and is constantly being inflated by banks, real estate agents, developers and anyone else with a vested interest. . The fact that we have the highest wage to price ratio in the world and essentially the most overpriced property in the world should be ringing alarm bells, yet amazingly people remain oblivious to it.

When it all eventually comes crashing down, I will be there with my bucket of popcorn watching the fireworks.

[danzvtil]

Originally Posted by Rodge

That bit stood out like a sore thumb. A reasonable percentage of small business owners indulge their passion(s) more than is sometimes in their best interests.
I know of one small local panelbeating business where the owner spends over $60,000 per annum racing rally cars, then complains that times are tight and gives his few staff Jack Shyte in the way of a Christmas bonus. Some of the inefficiencies I see as an accountant with small business's really amaze me. People making $150,000 per annum and claim they're flat broke and can't afford to pay their tax More often than people would imagine, a business owner can be really good at what it is they do for a business and completly hopeless managing their finances.

I wonder how many of these business owners are sucking out large monthly drawings to pay for their jumbo house mortgages ?

I am a wholesaler to garden centres and hardware stores, there are several factors at play here. The reality of running a business today is simply how much all your costs have increased, penalty rates, workcover water,rent,rates,super contribution.
Add to this the fact that imported stock has become soo cheap over the last few years, that businesses are selling ever higher volume to make less and less profit.
All of this favours large businesses who have deep pockets, are able to vertically integrate their supply (ie- they go direct overseas to source) and the ability to change if required. The old family businesses which are still partying like its 1999 are failing to adjust, and whinging that they are not viable.Some though ARE adjusting, focussing on their strengths, ridding their business of excess fat and are pulling thru.
It never ceases to amaze me when failing business owners blame the Guvmint/weather/Bunnings for their demise when they have what appears to be excess staff, 29 cars on lease for the whole family and wonder why the bank is banging on the door.
The overwhelming feeling across all wholesale and retail stores is the fact that we are now working HARDER than ever before for what little business is available.

[Crazy Dazz]

Originally Posted by Rodge

Some of the inefficiencies I see as an accountant with small business's really amaze me. People making $150,000 per annum and claim they're flat broke and can't afford to pay their tax More often than people would imagine, a business owner can be really good at what it is they do for a business and completly hopeless managing their finances.

It’s a sad fact that MOST small businesses in Australia Fail. I did small business Accounting & Tax for over a decade, and it was a universal problem. A person can be a brilliant <insert trade here>, but a poor manager and often a hopeless Commercial Manager. So many have absolutely no clue about profit margins and marketing, they just open their doors and expect to make money.
Panel beaters face an especially tough time. Their income is dominated by insurance work, and that means doing a job for the cheapest possible price, which is hard if you have any ethics or pride.

I'm climbing on my same old soap box here, but WA is still mostly going along fine. If anything the disparity in the 2-speed economy is growing. The Mining & carbon tax has stalled a lot of projects, but I expect that to improve next year. Keeping in mind that if the AUD continues to slide against the greenback, that is GOOD news for exporters. I don’t think it would still be technically called a mining boom, but there is still sustained demand for commodities. The government needs to reduce our reliance on imports and boost manufacturing in NSW & Victoria. That would be a win-win for everyone. It really ***** me to tears to work on massive projects where thousands of tonnes of (****, poor quality) steel is being shipped in from China, when it could have been more easily milled in SA or NSW. The WA government doesn’t give a crap, cos we haven’t had a steel mill for yonks, but the Feds should do something to limit the imports.
They also need to do something to stop the wholesale rorting of the 457 visas. Again, I worked on a massive project where the owners had been allowed to bring in thousands of Chinese workers. If they were any indication, China won’t be ruling the world any time soon. Slow, lazy, incompetent, dishonest, and with trade “qualifications” that they probably bought on the internet. But hey, they were CHEAP. The union that should have been protecting Australian workers got bought off. The company paid for all its Chinese workers to be fully paid up members, thereby buying the union’s silence.

[fte50]

Originally Posted by Crazy Dazz

The union that should have been protecting Australian workers got bought off. The company paid for all its Chinese workers to be fully paid up members, thereby buying the union’s silence.

That is pathetically sad - the union should've taken a moral stance and rejected the payments/memberships.
Again goes back to what this thread is somewhat about - greed..... makes me sick to be a unionist at times.

[DJR-351]

Originally Posted by Crazy Dazz

They also need to do something to stop the wholesale rorting of the 457 visas. Again, I worked on a massive project where the owners had been allowed to bring in thousands of Chinese workers. If they were any indication, China won’t be ruling the world any time soon. Slow, lazy, incompetent, dishonest, and with trade “qualifications” that they probably bought on the internet. But hey, they were CHEAP. The union that should have been protecting Australian workers got bought off. The company paid for all its Chinese workers to be fully paid up members, thereby buying the union’s silence.

Thousands you say, I've worked in mining & construction/offshore oil & gas since 1980, all in WA, and never heard of a "massive" project importing "thousands" of Chinese workers over the top of Australians and I or my two brothers have worked on most of the bigger projects in WA, I'm currently working on the biggest project (Gorgon) this country has ever seen (make's the Snowy Mountain's scheme look small) and one of the biggest in the world and I can't recall ever seeing an imported Chinese yet! Both of my brothers are in mining, one in the Pilbara and the other in the goldfields and they haven't heard of this either.....we all know of 457 visa's being used to fill gaps in the skilled workforce that Aussies won't.......but thousands on the one project? news to me.......

And how did they get them to site? I'm pretty sure thousands of Chinese workers transiting Perth Airport to point's north would have created a stir......

We have plenty of Pom's, South African's, Kiwi's, Yank's, Canadian's and Filipinos working in my industry, all with the same wages and conditions as Australians, and every one of those positions was filled after both the employers and the unions exhausted all avenues in Australia, we wouldn't have it any other way.....

Which project was this and which unions involved? one phone call will easily confirm or deny the claim.....

[Crazy Dazz]

Originally Posted by DJR-351

Thousands you say, I've worked in mining & construction/offshore oil & gas since 1980, all in WA, and never heard of a "massive" project importing "thousands" of Chinese workers over the top of Australians and I or my two brothers have worked on most of the bigger projects in WA, I'm currently working on the biggest project (Gorgon) this country has ever seen (make's the Snowy Mountain's scheme look small) and one of the biggest in the world and I can't recall ever seeing an imported Chinese yet! Both of my brothers are in mining, one in the Pilbara and the other in the goldfields and they haven't heard of this either.....we all know of 457 visa's being used to fill gaps in the skilled workforce that Aussies won't.......but thousands on the one project? news to me.......

And how did they get them to site? I'm pretty sure thousands of Chinese workers transiting Perth Airport to point's north would have created a stir......

We have plenty of Pom's, South African's, Kiwi's, Yank's, Canadian's and Filipinos working in my industry, all with the same wages and conditions as Australians, and every one of those positions was filled after both the employers and the unions exhausted all avenues in Australia, we wouldn't have it any other way.....

Which project was this and which unions involved? one phone call will easily confirm or deny the claim.....

Well if you knew as much as you claim, you would know the project wouldn’t you? The project is well known, mostly as a notorious series of stuff-ups.
“Thousands” is of course an estimate, but I think it would be accurate given the size of the camps and the numbers I saw. At any given time when I walked in for dinner, there would be at least 500 in the mess, and that’s just at one camp. The project was Chinese, and most of the work was given to Chinese companies. So there was not just blue-collar workers, there were literally hundreds of Chinese “Engineers” as well. Plus the majority of the equipment was sourced from China, so there more Chinese subbies. Then they started mobilising their Chinese operations staff…

As for thousands of workers transiting the Perth airport, the poor sods were working something like 13 week rotations and had to pay for their own flights home. (I'm not 100% certain, but I imagine they were technically entitled to “rest days” to comply with legislation.)

The lie that was sold was that all foreign workers would be paid award wages as for TA’s. What a joke. They were all working through subcontract companies so there would be no way to tell how much they actually received. From what I heard, from people speaking to those that could communicate in basic English, these guys were ultimately receiving only a fraction of the money.
To ensure the union “didn’t lose out” (and I guess for general industrial harmony) the Chinese workers had to be paid up members. The lie in that is that there were of course substantially more of them than would have been required for Australian workers, and at 100%, whereas Australia membership levels can be substantially less.

I'm not a racist. The Mining & Construction industry is as multi-cultural, ethnically diverse, and racially harmonious as they come. I have worked with people from all over the globe, and when I say “Australian workers” I mean the normal mix of (appropriately qualified) people you find on any site.
I have no problem with 457 visas being used LEGITIMATELY to cover SHORT-TERM gaps in skilled labour, at one time the company I worked for imported laggers from Ireland because we couldn’t find them in Aus, and at another we used Korean Welders because with all the O&G projects we couldn’t find coded welders for love nor money. (And whilst I'm on the subject, I will say that those welders from SOUTH Korea were fantastic; highly skilled, hardworking, and took a real professional pride in their work.)

However, over the years, I have seen the 457 system rorted again, and again, and again. Depending on which company, it will generally be a particular country getting the benefit. It happens at all levels, from un-qualified professionals being parachuted into “jobs for the boys,” to unskilled workers being brought to fill basic roles such as TA’s and basic riggers or scaffies.

And here’s the thing, why the **** should I care? WA is doing fine, thanks very much, and I'm doing quite nicely. Cheap imported labour means more money for us, and less pressure on housing and the cost of living.
As I mentioned, it has eased off considerably at the moment, but when things heat up the responsible companies fly in workers from the East. At least that way we are helping the rest of Australia as well.

But you’re right. I should just adopt your “bugger you Jack” attitude towards the rest of Australia.

[DJR-351]

Originally Posted by Crazy Dazz

Well if you knew as much as you claim, you would know the project wouldn’t you? The project is well known, mostly as a notorious series of stuff-ups.

But you’re right. I should just adopt your “bugger you Jack” attitude towards the rest of Australia.

So I will ask you again, which project and which unions you claim were paid off, what's your problem sport, name and shame, man the **** up!

Nothing but sensationalist BS.......

And for your information sonny boy, my aim is to prevent companies trying to rort the system, but the biggest headache I come across is twits such as yourself whose aim it is to blow it all out off all proportion and create unrest....

So back up you claims or **** off, you ain't helping anyone!.....

[nstg8a]

Originally Posted by Crazy Dazz

It’s a sad fact that MOST small businesses in Australia Fail. I did small business Accounting & Tax for over a decade, and it was a universal problem. A person can be a brilliant <insert trade here>, but a poor manager and often a hopeless Commercial Manager. So many have absolutely no clue about profit margins and marketing, they just open their doors and expect to make money.
Panel beaters face an especially tough time. Their income is dominated by insurance work, and that means doing a job for the cheapest possible price, which is hard if you have any ethics or pride.

I'm climbing on my same old soap box here, but WA is still mostly going along fine. If anything the disparity in the 2-speed economy is growing. The Mining & carbon tax has stalled a lot of projects, but I expect that to improve next year. Keeping in mind that if the AUD continues to slide against the greenback, that is GOOD news for exporters. I don’t think it would still be technically called a mining boom, but there is still sustained demand for commodities. The government needs to reduce our reliance on imports and boost manufacturing in NSW & Victoria. That would be a win-win for everyone. It really ***** me to tears to work on massive projects where thousands of tonnes of (****, poor quality) steel is being shipped in from China, when it could have been more easily milled in SA or NSW. The WA government doesn’t give a crap, cos we haven’t had a steel mill for yonks, but the Feds should do something to limit the imports.
They also need to do something to stop the wholesale rorting of the 457 visas. Again, I worked on a massive project where the owners had been allowed to bring in thousands of Chinese workers. If they were any indication, China won’t be ruling the world any time soon. Slow, lazy, incompetent, dishonest, and with trade “qualifications” that they probably bought on the internet. But hey, they were CHEAP. The union that should have been protecting Australian workers got bought off. The company paid for all its Chinese workers to be fully paid up members, thereby buying the union’s silence.

So why isn't this being plastered all over the media?

Simple, because the media reports what it's told to report....

[b0son]

Originally Posted by Crazy Dazz

Panel beaters face an especially tough time. Their income is dominated by insurance work, and that means doing a job for the cheapest possible price, which is hard if you have any ethics or pride.

And why is that? For many years, panel beaters used insurance jobs for easy profit. Remember the days of one quote for private jobs and another, heavily inflated one for insurance?

[Elbow_grease9]

Originally Posted by Rodge

That bit stood out like a sore thumb. A reasonable percentage of small business owners indulge their passion(s) more than is sometimes in their best interests.
I know of one small local panelbeating business where the owner spends over $60,000 per annum racing rally cars, then complains that times are tight and gives his few staff Jack Shyte in the way of a Christmas bonus. Some of the inefficiencies I see as an accountant with small business's really amaze me. People making $150,000 per annum and claim they're flat broke and can't afford to pay their tax More often than people would imagine, a business owner can be really good at what it is they do for a business and completly hopeless managing their finances.

I wonder how many of these business owners are sucking out large monthly drawings to pay for their jumbo house mortgages ?

This.

[superyob]

Originally Posted by cobramania

I think without a doubt, it's going to be tough times ahead for the entire automotive industry (among others).

Over the past 6 months or so, 3? Ford dealers have closed in Sydney alone, with another one going in the next month, other brand dealers have gone too.

Also with Ford shuting up shop in 2016 if not before, & I'd say Holden won't be far behind, with Toyota following.

Only the strong will survive, but as we've seen, the marketplace has taken it's toll on even the biggest of companies, Ford & GM, so it's going to be near impossible for the little guys to survive unscathed.

Yesterday afternoon a mate of mine walked away from his Smash Repair business of around 30 years. He was a few months behind on rent of his workshop, & cash flow has been tight for some time, but he was trying to trade out of it.

Yesterday it all became too much, & he collected up a few hand tools, took a few customer cars who's jobs were almost finished, shut the doors & walked away.
Leaving the rest of the tools, paints, some parts, 3 or 4 hoists, the spray booth, 2 large diesel generators, & about 5 personal project cars in various states of repair/restoration, for the landlord to sell off & recover the rent + make any profit he wants from the sale.
He'll finish off the customer cars himself using another workshop & payup any small creditors with the last of the insurance payments from the customers, then walk away empty handed.

I'm not sure if he's taken his Variety Club Bash car or left it?
He competes in the Variety Club Bash every year & has done so for about 10 years now. Even if he's kept the car, I doubt he'll have enough money to compete next year, so a very good charitable cause has also lost funds/donations & become a innocent victim.

About 8 other staff will/have lost their jobs as a result. Not good this close to Christmas, but there was nothing else he could do, with costs rising, insurance companies screwing repair prices down, often to below cost so corners have to be cut. Everyones losing out here & no one will win in the end.

Unfortunately I predict come 2017 Aus will be in a major recession, with many out of work, little money around to spend, with the auto industry being just the start, & there's little the current government can do to avoid it.

In my industry also, (Air Conditioning), in the Sydney, Central Coast & Hunter areas, I know of at least 25 A/C installation companies who've shut up shop in the last 3 months with more to come at the end of this summer season (around March/April). Some of the older guys have retired early, younger ones are looking to move on to elsewhere (another industry). My own boss is very seriously (almost confirmed) to be giving it away & retiring at the end of the season.

I vaguely remember some financial 'guru' on TV a few years back saying that 2020 was going to be a disastrous year, but I don't remember why...

[Robdogg]

Was vaguely watching some abc program this morning and they said the export business accounted for 60% of GDP in the 1960's but now it's like 10% and farming was around 2% of that and most of the rest was from mining. Got a mate that worked at pilkington (glass manufacturer) that has now closed down because it's cheaper for glass customers to buy and ship and deliver to their door from china than it is the just buy local. I know of a lot a businesses just scraping by and I know some that are borrowing money to cover wages/expenses hoping things will get better but as most people know unfortunately australia is going down hill fast and I wouldn't be surprised if it goes like some European countries where they barter because most won't have money or the money they have won't be enough to buy bread.


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