John Linton
It still surprises me how fast you can spend money when you move premises. It seems to me that no matter how careful I try to be in getting firm quotes for 'everything' all that really happens is that you get a constant stream of requests for all sorts of things that "weren't included" in the original quote and now seem to be urgently required as they weren't ordered when they were supposed to be - and I only have myself to blame as I took the responsibility for ensuring all the details were known before we started. Having said that the 'building work' for the new premises is proceeding very quickly and, if anything, appears to be ahead of schedule.....my brief look yesterday revealed the expected chaos of a building site/floor with 8 or 9 tradesmen doing various things to it but, if I wasn't mistaken, it was a more advanced sort of chaos than I had expected to see. Let's hope it turns out that way.
I mention the building work because Exetel's CFO and I have been putting in place the changes to the Exetel FY2010 business plan in preparation for the next Exetel board meeting tomorrow and it seems that like the plans I put in place for the new premises we have had to add a lot of 'forgotten' items to the new plans for next financial year as we plan to change our business away from the 'model' of the past five years. Our major problem is that we have obtained no realistic estimate of what may or may not happen generally across Australia over the coming twelve months. We have been 'preparing ourselves' for an 'economic downturn' for over 8 months but have seen little or no impact on our small business to date with the exception of one of our business customers going into receivership (a chain of 11 hotels). We haven't seen any sign of the expected higher payment defaults from residential customers (perhaps courtesy of the Krudd welfare cheques) and our business volumes all continue to grow month on month - pretty much on or mostly above the planned targets set almost 12 months ago and only slightly modified downwards towards the end of 2008.
So we are adopting a conservative approach to the new financial year, although we are budgeting to spend more money than we have spent in the previous five years put together (not that is saying much) in building a much larger sales presence (and who knows - even a marketing program!!!) to promote the HSPA services and perhaps one or two other services. Of course, Exetel is a very, very small company and whatever we do makes absolutely no difference to any company we compete with or to any end users in any marketplace in which we offer services. However it is important to us that we continue to remain financially viable and therefore continue to support our current customers with the lowest priced services it's possible to deliver and therefore protect the jobs of our employees. This requires, as always, a very conservative approach to expenditures and an even more conservative approach to revenue and profit expectations which can get very boring for our more 'adventurous spirits' who would prefer "global domination" to nights of sound sleep free of worrying about how to pay tomorrow's bills.
One of our two very aggressive pieces of planning is to more rapidly grow a business sales force by, perhaps and with a large number of "only ifs", as much as 30 additional people over the full twelve month period. Our rationale is that we continue to make progress more rapidly in percentage growth terms in business services than we do in residential services and we have now built the benefits of a five year track record of delivering 99.99% up times to business customers and have still retained over half of the customers who signed up with us 5 years ago as references for continued service excellence. It is a gigantic market with huge potential for even a tiny company like Exetel and we can control the sales cycles involved much better than we can in any other part of our business at the moment. Whether we remain that 'brave' as FY2010 reveals what it is really going to turn out like remains to be seen but we are planning very aggressive growth at this stage.
The other 'brave' piece of planning is our promotion costs and personnel costs in attempting to deliver on our desire to build 100,000 HSPA customers by the end of Calendar 2010 and the associated growth of the agent network in rural and regional areas of Australia. This is far more difficult to do than anything else we have ever attempted and we will need new personnel of very different types to those we have worked with over the past five years. So not only is the actual process going to be very difficult the acquisition of two or three key people is going to be a very difficult thing to do before we can make a serious start to the program though, almost certainly because of my procrastinations, we will have to start now rather than when/if we find the people we need to make it as successful as we need it to be.
So we have another 24 hours to complete the 'spread sheet' version of FY2010 so it can be considered over the next six weeks and, as always, those pristine spread sheet columns and rows deliver a pleasingly symmetric promise of fiscal safety and acceptable month on month profits delivered by an ever steepening growth curve of increasing customers and revenues for each of the ten products/services. We have kept the business plans in the same Excel spread sheet since we started and so have over 60 months of 'history' that i must turn into a graph one day to show Exetel's performance from January 1st 2004 up to now. I think it would be an interesting 'sales tool' in terms of demonstrating the progress the company has made in terms of number of customers (per product/service) together with revenue, profit and personnel growth over that period.
If only 'real life' was like an Excel spread sheet.
PS: I couldn't be bothered to mention the rambling mess that was last night's "budget" but I think noted Howard hater, and chief economics writer for the SMH summed it up better than I could ever do here:
http://business.smh.com.au/business/federal-budget/planning-the-cleanup-before-the-storm-has-even-arrived-20090512-b20m.html