Issue link: https://viewer.e-digitaleditions.com/i/122153
financespecial Taking the chance With business booming in the bush, Mark O'Donoghue from Finlease tells OUTthere how you can make the most of the current climate. What is the business climate like in regional Australia at the moment? In the regional areas we're close to – for example, the Central West of NSW – we're seeing, on the whole, a confident, stable environment with robust businesses that are sensibly expanding where there are opportunities or trading well if not presently in expansion mode. What does this mean for your business? It allows us to actively support and expand our base of long-term clients because that growth provides us with an opportunity to compete against the banks for those clients' long-term finance requirements. You need an opportunity to 'perform' and more of these opportunities come with a robust expanding market. What does this mean for your customers? A robust environment makes it easier for clients to contemplate expansion and equipment upgrades because it is a more supportive economic environment. Instead of being in 'survival mode', this landscape lends itself to business growth, upgrades and the finetuning that comes with greater economies of scale. What can they do to make the most of this climate? What's your advice? Most business owners have an intuitive 'gut feel' about when it is right to take advantage of an improving or robust market. Today we see many signs of more fertile times: improved consumer confidence, increasing Sydney property values (it's been a while) and a rising share market. Though he isn't the Messiah, Warren Buffett has said he will have his foot "flat to the floor" in 2013. With interest rates at historic lows, businesses have the opportunity to lock down long-term cheap debt for vehicles, equipment and property. Without being reckless, the forecast looks good enough to 'clear-fell a few more paddocks'. What is the most common mistake you see business owners make? Assuming the finance offered by their banks is the best in the market regarding interest rates and conditions. Money is no different to any other raw material – it should be accessed in the cheapest, most flexible form without wrapping up all of the other securities. There are many 'suppliers' of money that are keen to compete for a good customer; you just need to make yourself visible so they can compete. What are your top three tips for business owners in regional Australia? 1. Treat money like the commodity it is and shop around for the best financial facility. 2. Maintain control over your own destiny by knowing what your defence trenches are (what you need to do if things get tight). 3. Remember that cash is king. Cash flow, often more than profit, ensures you maintain control of your business. 81