Do penalty rates kill profitability?

by Dr. Greg Chapman

There was recently some controversy when a restaurant posted on their menu board that they couldn’t open on public holidays because of the mandatory 2.75 times penalty rates in South Australia, claiming that they would have to increase their menu prices by the same amount. Another article a few days later revealed the same situation in Canberra, and now it is being raised in the Australian Industrial Relations Commission by the Government. There has been a lot of ill-informed and abusive commentary by some patrons in social media (how unusual!), so what is the reality?

First let’s deal with the claim that their prices would have to increase by 2.75 times to cover their costs. As many rightly pointed out, labour is not their only cost.

Ad of the Month – Innovation

by Dr Greg Chapman

Valentines Day is a great day for marketers. It’s an opportunity to get people in specific categories, such as florists and confectionary to boost their sales, but unless you are innovative, you will miss out.

What if you had a product that is never associated with Valentines? How could you elbow your way into the sales? What if you sold Doritos corn chips? Why would anyone give corn chips as a Valentines gift? Is there a market gap?

Do penalty rates kill profitability?

by Dr. Greg Chapman

There was recently some controversy when a restaurant posted on their menu board that they couldn’t open on public holidays because of the mandatory 2.75 times penalty rates in South Australia, claiming that they would have to increase their menu prices by the same amount. Another article a few days later revealed the same situation in Canberra, and now it is being raised in the Australian Industrial Relations Commission by the Government. There has been a lot of ill-informed and abusive commentary by some patrons in social media (how unusual!), so what is the reality?

First let’s deal with the claim that their prices would have to increase by 2.75 times to cover their costs. As many rightly pointed out, labour is not their only cost.

Small Business Best Practice Benchmarks

by Dr. Greg Chapman

There have been many studies on what great businesses do differently. Each have identified a number of common benchmarks. Over the next 12 months I will review key Small Business Best Practice Benchmarks for Australian businesses. These will include Business, Financial, Marketing and Operational best practices.

The first practice in common with all great businesses is Strategic Planning. They all have a five year plan.

As the Cheshire Cat said to Alice “If you don’t know where you are going, any road will take you there”

Points of Difference - A Lesson from Big Business for Small Business

by Dr. Greg Chapman

Normally when I write on lessons from big business, it’s to give small business owners some strategies developed by people with much more money and resources that could benefit those who aren’t similarly advantaged. However, in this case, I have an example you don’t want to copy.

Recently I changed energy providers. I was cold called by a competitor to my current supplier. Normally, I don’t respond to such calls, but I had just paid my quarterly bill, and was thinking about how expensive it was. Perhaps the competitor knew my billing cycle, which was a clever move if so, or else they just call all the time, knowing at some point they would get me at the right time. Also smart. Persistence. Particularly when they knew they had a better offer.