Jump to content
Sign in to follow this  
SacrificialNewt

Clive Palmer

Recommended Posts

9 minutes ago, Nich... said:

Sure, that was aimed at Rybags, whom you quoted.

 

What's 'getting away with it'?  Like, when people just assumed he was doing what he was meant to, until someone looked into it and then suddenly the charity was totally rebranded to be non-Aboriginal, and the media and its consumers has let it fall by the wayside of the electoral trail? 

Well ... 

 

Share this post


Link to post
Share on other sites
18 hours ago, Leonid said:

Look, I'm going to help you out because clearly you know next to nothing about business.

 

 

I'll admit, I have no qualifications in business, and I am happy to be educated.

 

 

18 hours ago, Leonid said:

 

In terms of anti-competitive laws... I'm not sure if you're aware of this, but it is exceedingly possible to use your market power to lower your costs and IT'S NOT ILLEGAL! How's this work?

 

Well... imagine you're a big supermarket chain that has x visitors. You got to supplier y and tell them "Hey, we'd like your product front and centre as people enter the store and when they leave. What's that worth to you?".

 

Supplier y thinks for a second and figures their 30% margin is compromiseable for a volume-of-sales increase and drop their margins to 20%. You mark it up 5% on top of that. You're below the cost level a small business can sell that product at and you've broken no laws because negotiating with your suppliers is not (and should never be) illegal.

 

 

 

Now since we're on convenience stores and such, maybe you need a heads up... 

 

Westfarmers (which owns Coles) paid 30% effective tax rate in 2018 and 29.97% in 2017. 

Woolies paid 30.3% effective tax rate in 2018 and 29.6% in 2017

 

Fair enough

 

 

18 hours ago, Leonid said:

 

Do they minimise their profits and have armies of accountants looking for loopholes? Course they do - see first paragraph of my reply - getting bigger means more profit which means you can invest more into profit-making. But by-the-by, as if trying to find a way to pay less tax is (a) not the most Australian thing everyone does, and (b) all the methods used are as available to small businesses as they are to big businesses?

 

 

I'll help you out there too. From what I'm told, about 60% of Aussie small businesses use overdrafts to smooth out cash flow.

 

I understand the reasoning for an overdraft and I actually worked in accounts receivable for a small company once so I'm all too aware of what it's like to have a lot of money outstanding  whilst owing similar amounts to others. It still stands that if the company is not making enough profit  to pay their bills, then they can't afford an overdraft - which in effect is a perpetual loan.  For the bank to be sure, then I would think they would need to see and scrutinise your accounts over time. As I said, if you got the overdraft because you could afford it, then all's OK in the end.

Share this post


Link to post
Share on other sites
3 hours ago, Nich... said:

 

 

Does that apply to small companies, too?  Like, no more loss-leading specials to get people in the door for your small local?

 

In theory yes, but I admit it would be hard to police and might not be feasible considering there are reasons a vendor might sell stock under price  (eg. unsaleable or near expiry stock) other than to put someone else out of business.  I would suggest that deeming whether a business is being truly anti-competitive is a job for bureaucracy and bureaucracy is rarely efficient.

Share this post


Link to post
Share on other sites
Posted (edited)

It's an aside but I suspect that somewhere in Leo's mind is the Cisco model.

 

Pretty much unique among IT manufacturers Cisco do not work only in channel, they also go direct, obviously only really on big deals. Then, quite often, they push the business back to a preferred channel partner and set the margin on the hardware from a base cost that is way, way below their normal  listed cost price but usually only leaves a low single digit margin for the channel partner who then has to make his money on services as in install/config. Cisco often dictate that to a degree as well.

 

You need to be a big seller of Cisco to even be at the table for those sort of deals. I worked for many years for a very successful SI that was party to that relationship.

 

I doubt Leo's business is big enough for that but he possibly has a relationship with one of the bigger guys to either sub the services or buy via them.

 

It's all totally legal, I've just never liked it but then again I don't really like Cisco kit much either. Pain in the ass to configure, IOS should have been re-written decades ago, their GUI is rubbish, they make what should be simple difficult.

 

They are sort of the Ford of IT, huge but very, very average and expensive over life cycle.

 

They are also a bit like IBM, the old paradigm of no one gets fired for buying IBM also applies today to Cisco.

 

Funny thing is many of my friends work for Cisco and love it - I'm just not sure I could put on blinkers that tight.....

 

Cheers

 

 

 

 

 

 

Edited by chrisg

Share this post


Link to post
Share on other sites
3 hours ago, chrisg said:

Pretty much unique among IT manufacturers Cisco do not work only in channel, they also go direct, obviously only really on big deals. Then, quite often, they push the business back to a preferred channel partner and set the margin on the hardware from a base cost that is way, way below their normal  listed cost price but usually only leaves a low single digit margin for the channel partner who then has to make his money on services as in install/config. Cisco often dictate that to a degree as well.

 

can you tease this out a bit?  i am obviously not getting it.  the channel partner is a reseller of their hardware?  if the cost they pay is low, why is their margin so small?

Share this post


Link to post
Share on other sites
Posted (edited)

Hmm,

 

Channel partners of Cisco are graded, not sure if it is still done this way but it used to be metals, silver up to platinum.

 

The SI I worked for made it to top tier within one Oz State, never been done before.

 

Cisco do not have an RRP list, not really, some of the more domestic product they picked up in their acquisition-fest  yes, but not the enterprise gear.

 

Their pricing is incredibly fluid, which is rather understandable if you pull even one of their high end pieces of kit apart. The components are not exactly much to drool over, in fact once they had a tizz about people using non Cisco RAM to upgrade their own kit when it was just el cheapo, we used to put Corsair in and ask the rep if he knew why that was better 🙂

 

Their value lies in a mix of IOS, which they were first to market with via EIGRP, which remains not really standards compliant, and very, very good marketing plus underlying good early venture capitalisation.

 

So, the more Cisco you sell the better your discount the more deals they steer to you the more they help you win the biz.

 

There's nothing wrong with that at all, it's a healthy business strategy, I just wish the kit and OS was better.

 

Believe me, I have walked Tasman where they occupy the entire street in Silicon Valley to  see if anyone in the company has any interest in making the product easier to use - not for me, I grok IOS, begrudgingly, but for customers who end up either tied to an SI or enrolling for expensive Cisco training. Nobody is, too much gravy in making it a chore...

 

Not healthy, but reality.

 

Cheers

 

Edit: Actually I did not really answer your question. Cisco if they are in a deal with you as an SI actually do everything possible to get you the deal and they dictate what your margin will be via what the retail industry calls an LTI, Long Term Incentive. Every quarter based upon your sales you get a nice big cheque, but if you work it back, and smart SIs do, it is a very small percentage of each sale.

 

Matsushita in Japan possibly made the concept mainstream.

 

I used to sell VCRs when that company had both National and JVC brands under its umbrella. National had a top line model that really was quite nice but not ergonomic. It was about $100 cheaper than the JVC top line which was much better overall.

 

The difference was if I sold a National I made sub 5% up front and IF I sold a shitload of them we eventually got a "bonus" of around 20%.

 

If I pushed the JVC, which was a much better machine, I'd typically get 30+% profit on invoice - we got a pretty good price from JVC simply because we sold so many...

 

The National rep kind of hated me but we sold so many of his other products that had no similar competitor that he was forever buying us drinks etc. One night I explained the above to him... he had no idea he was working for the company that owned his biggest competitor...

 

I hope IT does not go that way, but probably it will.

 

 

 

 

 

 

 

 

Edited by chrisg

Share this post


Link to post
Share on other sites
On 5/10/2019 at 4:17 PM, SacrificialNewt said:

It still stands that if the company is not making enough profit  to pay their bills, then they can't afford an overdraft - which in effect is a perpetual loan.

 

Best way to look at an overdraft is as a business credit card. It can be attached to your main account and allows it to go negative.

 

Its main function is to smooth out cash flow in the gap between AR and AP. As an FYI, we could get an overdraft before ICAC was handed down. Soon as it got handed down, we couldn't. Now our bank manager is calling us again, saying its available.

 

This event has had nothing to do with our cash flows - it has everything to do with the knee-jerk reaction the other way, as a function of ICAC. It has had an extremely deleterious effect on business, which hasn't been helped by having two elections in Australia's premier financial state and the Federal circus coming up next week.

On 5/10/2019 at 5:22 PM, chrisg said:

It's an aside but I suspect that somewhere in Leo's mind is the Cisco model.

 

You take that back. Right now.

  • Like 1

Share this post


Link to post
Share on other sites

🙂

 

Oh I wasn't saying you operate that way, just giving an example of how big business can control the market with particular reference to IT.

 

I'm pretty certain you are well aware of how Cisco do things and I suspect you don't much like it any more than I do.

 

If not sure, I apologise  🙂

 

Cheers

 

 

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

×