Michel Hogan runs the brand alignment and advocacy company, Brandology. Check out her weekly blog Brand Matters at Smart Company.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

Fiona Boyd: My guest today is Phil Grant, managing partner at Nexia ASR. Hello, Phil.

Phil Grant: Hi, Fiona.

Fiona: Look, there have been a lot of reviews – or, there have been some major reviews that have an impact, should have an impact on the accounting area and business in general in recent times, as well as the budget, and I thought maybe you could give us a bit of a wrap-up about those today. Firstly, we had all that economic stimulus last year – are there any hidden issues in there for business now that tax time is coming round again?

Phil: The biggest thing that came out of that stimulus package really for business, I mean to the extent that more money was spent, hopefully that’s been reflected in the clients’ bottom line, not sure if that’s really the case or not – some yes, some no. Obviously the accelerated depreciation write-offs for certain assets, there were various different cut-off dates but essentially 31 December last year was the cut-off date, so it’s important that, in compiling information prior to doing your tax returns for the June 2010 financial year, is that we don’t forget that. Because, for small businesses with a turnover of less than two million dollars, the ability to have a 50 per cent write-off for eligible assets, so that’s a straight 50 per cent deduction in addition to ordinary depreciation that’s able to be claimed on those assets. So…

Fiona: That keeps money in the company in that financial year, right?

Phil: Well, it just becomes an additional tax deduction, so therefore there’ll be less tax to pay, so that obviously conserves some cash flow in that less money has to get paid out to the tax man. Other than that, look, I don’t think there’s a huge amount out there. In the more recent time, we had the Henry Tax Review, we’ve had the Federal Budget, and we had the Cooper Review, which was another review to do with superannuation. I think it’s fair to say the Henry Tax Review was a non-event. There were a number of recommendations made by Ken Henry in respect of that, of which I think the government took up three.

Fiona: Oh dear. Poor Ken Henry…

Phil: It was an absolute waste of time. Obviously there’s a political environment we’re dealing with there… and the only thing which really, I mean they’re tinkering with the edges there. It’s not – it really was a non-event. And that’s a good thing and a bad thing. The good thing is, less change is probably a good thing as there’s less to concern ourselves with.

Fiona: In what way is it bad?

Phil: Well, you know, the bad thing: if there’s change there it’s always a problem. But there’s always the opportunity for the government to do something which could benefit business and that clearly didn’t happen. Ah, they said they were going to give some small… that the company tax rate was going to go from 30 to 28. Really? Big deal, truthfully. It doesn’t really have much of an impact, and there was some write-off there for equipment, up to five thousand dollars I think it was. And there was some, for individual tax returns, five hundred dollar write-off… But, really…

Fiona: Small biccies.

Phil: For businesses who are really the drivers in this economy, who are going to help us recover and move forward – not much of an impact, in my view. There are a few things – the Cooper Review was quite positive. The Cooper Review reviewed superannuation and, without going into detail, they’ve really reinforced the self-managed superannuation funds environment, which we’ve always advocated as being a good environment to help build wealth. So that was a big tick. They’ve obviously come out and said that commission-based plans are out, and I think everybody knew that was the case. Our financial services business started some 12 months ago when we knew that was not the model we wanted to pursue, and so we were free-for-service business, and that’s certainly where the industry is going. That’s a big positive.

Fiona: And Eureka Report have been lobbying since you started to get rid of those commissions.

Phil: Dreadful, just dreadful. So that’s changed, and that’s having an impact on that profession, because a lot of businesses were driven around that. But it’s not transparent. Fee-for-service is more transparent which is really what we’re after. There’s always stuff going on in the tax area. One in particular is in relation to a ruling which came out in relation to a section of the tax act called Division 7a, which is loans from companies to shareholders of those companies’ associates, and caught up in that is also distributions to companies, a very technical area, but suffice to say, which has changed the tax office’s stance on their positioning of those distributions, which will have an impact. There is no doubt there will be an impact on that for business who utilise that type of structuring. I think a lot of people are just trying to get their heads around that. But I think it’s fair to say that it’s an adverse impact.

Fiona: How are those distributions different to retained earnings?

Phil: Well, in a trust structure, you don’t have retained earnings. So trusts have the choice of either distributing the income or retaining it. Retaining it is usually at a tax rate of 46.5 per cent.

Fiona: Okay! This is why you distribute.

Phil: So we distribute out to an environment which is more tax-effective, but it’s obviously a distribution at the discretion of the trustees and they have to be distributions that make sense, and often a corporate beneficiary is being used to access a 30 per cent tax rate. But that landscape is changing. So, everybody who is using those structures needs to talk to their financial advisor or accountant about what that means for them.

Fiona: Okay Phil, thank you for your time today.

Phil: Pleasure.

Fiona Boyd talks regularly to Phil Grant, Managing Partner at Nexia ASR about financial matters, accounting and the entrepreneur.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

Our trip though was for R & R and not business thankfully though while we were there I couldn’t help but notice how many things done by the Hayman team and in delivering the Hayman experience, provided some unique insights into concepts that could be deployed in other places and other businesses.

One of these was the notion of offering a ‘peak experience’ to the customer base, not something that everyone will want to do, and the cost of it can be one of the factors that makes it exclusive, but something that can be nevertheless considered a pinnacle experience, a really neat thing to do.

On our day of arrival at Hayman Island, David and I trekked down to the reception to book a couple of adventures, one of these was to be the Chef’s Table and the other a few hours snorkeling on the reef. Chef’s Table wasn’t occurring until the night we were leaving, however there was a similar and even better experience (we were told) on offer called the Fontaine Bench.

At any one time there can be up to 500 guests at Hayman Island, and there are at least that many people again providing the labour and skill that keep things ticking over smoothely. Fontaine Bench is available for two nights a week and it’s only available to two people at a time, something David and I had not understood when we made our booking.

We booked the Tuesday night Fontaine Bench and rather than drone on about the amazing food and wine you can take a look at the menu, constructed just for us on that night, and one which changes as the Sous Chef sees fit, which can be often. The chefs at Hayman like to experiment and innovate, they have fantastic facilities at their disposal and use them to come up with new and unusual dishes.

The Fontaine Bench experience is for two people at a time and you are seated on an elevated bench at a table looking directly into the serving and preparation area of the Fontaine kitchen. La Fontaine is Hayman’s premier fine dining restaurant, where you can buy a hamburger for $150 a pop. We indeed saw a couple of these hamburgers being lovingly prepared by the Sous Chef, Anthony Healy, whose joy and delight in being in charge of the kitchen that night was simply infectious. His ingredient knowledge and ability to share it was also second to none.

Of the 12 courses we had, Anthony was able to talk us through the intricacies and ins and outs of most of them – food prepared to delight and entertain and inspire has a story and it was Anthony’s job to tell us the story of the food. It was such a great reminder to me that those who really love and know and understand what they’re doing are just so outrageously positively infectious.

But the key learning from me from the Fontaine Bench was that it’s good to have a really premium product available in your offering that can be that special one that those who use it wax lyrical about, and help bring other customers to your standard offering.

I really like the notion of having a standard offering and then a premium offering. With just about every type of product there will be a bunch of those who want and appreciate the regular experience and then a small handful who want a little bit more.

David and I spent a few weeks working with Marcus Padley who writes the fabulous stockmarket newsletter Marcus Today a few years ago, working up a renewal campaign to put a bit of spice into his subscription renewals and to remind people that his product offering really was the best of its breed. One thing we introduced after chatting to several renewing subscribers who talked Marcus up to the sky, was the Life Member category. It wasn’t cheap and the idea was more of an experiment to test the actual loyalty of these members, but we set the price at $5000 and waited to see what would happen.

Within two days there was a Life Member enquiry and subsequently sale. Two days after that another one sold, same again two days after that. We finished our stint with Marcus and this campaign, but I gained a really great insight into the mindset of the customer who really loves what you do – they will pay a bit more (or a lot more even) for a higher level of your product and maybe even a closer connection with you.

Crikey also figured this out when the founders were being sued and needed to find substantial funds even after selling their house, to pay their legal fees. They introduced the Life Member category, and lo and behold a raft of people who loved the Crikey newsletter and believed in the founder’s fight, signed up and leant their support. While there was an ideological underpinning here, the Life Members did get some special benefits: a special insider news just for them, and unique access to founder, Stephen Mayne,  that other subscribers didn’t get.

It’s true that your super premium product is unlikely to ever be the core of your business, as in the Fontaine Bench, but it can be the place where you build such strong customer loyalty around your brand that these super customers become your advocates and brand warriors. And even if they don’t they’ll just secretly enjoy their premium status in your customer group, knowing that they’ve paid for the privelege, and hopefully thinking it was worth every cent.

David and Fiona with the highlight of their Fontaine Bench dinner - the Martini Igloos.

So was the highlight of our recent Hayman visit Fontaine Bench? The answer to that question is ‘yes’. What then was the highlight of Fontaine Bench? Well that would have to be the Martini Igloo, pictured. A martini sorbet served in a carved ice sculpture, each one individually made for one service only. Pinnacle, peak, premium, call it what you will, this was one experience I’ll be talking about for a very long time to come.

Photo: David Eedle

David and Fiona write about their first visit to Hayman Island in 2006 in their book Niche Content Millionaire – the story of the startup, growth and sale of their business, Arts Hub.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

However, we didn’t just want to map out and then tell the Arts Hub story, we wanted to condense the journey into some key lessons for those who wanted to venture into niche publishing. It was our belief then and it still is that one of the great frontiers online that has only partly been exploited is that of niche content.

What we mean by that is that if you can provide content of a high quality in a specialist or niche field for a bunch of people who are interested in or work in that area, then you can create a product that those people will pay for. Many of us understand that it’s important to keep abreast of the trends and challenges in our industry or even in an area that is a hobby for us, and pulling this sort of information together for people has a value.

One of the opening stories in the book David and I subsequently wrote about niche content and the Arts Hub journey, Niche Content Millionaire, was about our treat to ourselves and our children immediately after selling our business. David describes the bliss of being at Hayman Island in the Whitsundays, dropping the elder children to Hernando’s Hideaway (the island’s Kids Club, right next door to the Hayman Island State School – believe me they have a school there!) only to find out that the children needed their runners that day as they were going out on the reef, and that rather than David having to go back and get said runners, a porter was called to do the task. In the life of a harried parent, such service is gold.

In May this year I succumbed to a delectable special offer by email from Jetstar Holidays for a 4 night getaway to Hayman Island and the offer being just too affordable to be believable, I signed us up for it. The only dates we could get were in the third week of August and David and I are just back from our getaway to Hayman Island in the gorgeous Whitsundays. This time our visit was without children.

Hayman Island - has mastered the art of an Australian style of sophisticated service

It’s not often I’ve been known to say that a merchant has improved their service, but I must say that whilst the service we received at Hayman Island in 2006 was faultless and fantastic, this time round David and I agreed, it was even better.

When it comes to elite service, how do you get better? Surely the calibrations of certain kinds of service quality become much thinner, and individual perception and preference starts to have more of a sway?

Well what I noticed about the difference in service at Hayman Island Resort this holiday was that they seem to have perfected the art of an Australian style of great service, that is relaxed and empathetic and in tune with the customer. All our requests were deftly met and with absolutely no resistance, I can not say that that is my usual experience with any kind of service here in Melbourne. And that is not to bag Melbourne establishments.

Now you can say that it is easy to provide good service in a perfect climate when all the guests are relaxed and happy and not in the mood for trouble of any kind. However when you understand the sheer logistics and complexity involved in providing all the bits and pieces Hayman Island does to its customers with absolute ease and mastery, then I think you would be churlish to say that they have it easy.

I mused on this issue of even better than fantastic service on the plane home to Melbourne and decided that behind the scenes, Hayman Island must have one really great staff training program and that there must be some kind of focus around constant improvement, otherwise we would have experienced either the same level of service as in 2006, or not as good service.

And the impressions that this classy Australian style, friendly, warm, attentive but non-interfering service had on me – well I can’t wait to get us back there.

Hayman Island might be one of the older elite resorts in the world but to my mind the service quality there is the best I’ve experienced. In fact there were a number of lessons about business and excellence I took away from our recent visit to Hayman Island and I’ll share a few more of those with you over the next few days – one I want to tease you with is the Martini Igloo – more on that tomorrow!

Photo: Sarah_Ackerman

If you’d like to know more about how we celebrated the sale of our business Arts Hub, read our book Niche Content Millionaire.

PS – the constant references to Hayman Island are due to the writer’s hankering to return there as soon as earthly possible. The Into the Mountain folk, unfortunately have no commercial connection with the resort or its owners.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

Michel Hogan writes weekly on all things brand in her blog called Brand Matters on Smart Company. You can find out more about the work she does and how she helps companies get all aspects of their brand right at Brandology.

This interview was inspired by an event moderated by Michel Hogan at the Melbourne Churchill Club on luxury.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

Michel Hogan is an expert in the field of brand advocacy and runs the company Brandology. You can also read her latest thoughts on brand at Smart Company’s Brand Matters blog.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

Michel Hogan writes regularly about all things brand on her blog at Brand Alignment and on Smart Company at Brand Matters.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

I mean you’re the one at the top of the company leading the charge, everyone looks to you for a decision, and if there’s just you rolling out a big vision, well then, when do you get time to sleep?

For many of us the last couple of years has been about getting through the Global Financial Crisis and keeping our businesses afloat while everything and everyone around us reset their priorities and expectations.

David and I have a couple of new ventures in various stages of start-up. One is away in terms of the product but the next step is a really solid effort on sales and marketing.

The other one is having its technology tweaked and polished, although we have 3 great organizations who have agreed to be beta testers of it, so therefore we really need to hurry up and get it ready and get it into test mode.

David also does most of the work involved with our consulting business Webzing Pty Ltd and is in demand both in Australia and with a couple of technology clients in the U.S., and this is work that we’d like to continue with even when our two startups are underway and earning their keep.

This all leads me to the issue of how does an entrepreneur who is managing early stages of their business cope with the stresses and strains and manage to stay clear and capable of making great decisions and of seeing the opportunities when everyone else around them is too busy not seeing the forest for the trees?

Meditation can give you that holiday in your mind that leaves you feeling refreshed and raring to go.

I must admit that in the past I haven’t necessarily paid enough attention to my health and my overall emotional well-being and there have been many times during the past 15 years in business where I’ve resorted to a glass of wine or an extra coffee when indeed something properly relaxing was required.

When your days have blown out to 15 hours or more on business and you’re wondering where on earth you’re going to get a mental battery recharge from, consider doing something that I’ve taken to over the past couple of years. It’s not a new technology, various forms of this practice have been around for a couple of thousand years, however it is the nearest thing I know to getting an instant ‘holiday in your mind’ when there’s no real break imminent on your horizon.

I’m talking here about the practice of meditation. I’ve committed to giving myself 20 minutes in the morning before I get up every day to do a simple meditation and clear my head so that I can face with tons of energy anything that presents itself to me during the day.

Meditation is a personal preference thing, but the results so far for me are an increased sense of well-being and a greater degree of excitement and engagement in the business projects we’ve undertaken.

There’s no question that being involved in a start-up requires hard work, but it’s also important that you’re doing the right work rather than just working yourself down to a burnt crisp.

If meditation is not for you, then how about taking 20 minutes out of the most hectic part of your day and just putting the headphones on and listening to your favourite music? And not thinking about anything, just listening and enjoying the bliss of listening to music you really love.

I suggest that by giving yourself a holiday in the mind every day, you will be completely refreshed each time you do this and you will have way more energy to tackle your mountain of start-up tasks.

Photo: flickr h.koppdelaney

Michel Hogan talks to Fiona Boyd regularly about all things to do with brand. Michel also blogs about her brand insights at Brand Alignment and her weekly blog on Smart Company called Brand Matters is an ITM must-read.

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Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now

Owen runs both the real world LIV bookshop and its equally successful online version and because they are so well organized lawyers and those needing access to specific legal content from all over the country, purchase their content with the LIV bookshops. They have become the de facto national legal bookshop – a perfect niche in my opinion.

For me this was a really interesting meeting as I’ve not spent anytime at all in the world of law institute lawyers and all of my dealings with lawyers have been pretty much through the businesses David and I have been involved with and we’ve dealt mainly with commercial lawyers, who while still legal fraternity, are not really hallowed halls and unique precedents and arguments.

As I’ve written in previous blog posts, David and I and our little company Webzing Pty Ltd started a new venture, actually with specialist lawyers, the team at Erskine Rodan & Associates Immigration Lawyers a few months ago. Christine and Erskine Rodan had published in 2009 a unique book that drew on their vast knowledge of and practice in immigration law called Migrating To Australia: A Guidebook, that was one of only a couple of publications targeting the immigration law space.

This wonderful book was available in the Law Institute of Victoria bookshop and as Owen told us it sold really well and they’d sold out. The issue the writers found with the book was that in the area of immigration law there are at least a couple of legislative changes every month and therefore the book fairly quickly became out of date, even though it had been three years in the researching and writing. This issue of losing relevance as soon as there is a significant change to immigration law isn’t one that goes away in this fast-changing area of law, so a solution to this needed to be devised.

In our collaborative venture with the Erskine Rodan & Associates team we’ve  completely updated and a 2nd version of the Guidebook and decided to make it available as an e-book, giving us the facility to do a major update and rewrite as soon as the legislative changes start to make the content of the book look out-of-date and out-of-touch. But interestingly in our discussion with Mr Hyde from the LIV Bookshop, there are various really specific areas of the law where the customers really aren’t that worried that the book is out-of-date, that they use it as reference and a kind of text, but that they really like to have access to a hard copy version as well as an e-version.

Which leads us back to the issue of creating a book whose content we know will be out-of-date very soon, printing it on demand, but making sure we keep the customer properly informed via emailed legal updates. Whilst it is early days for Webzing and Erskine Rodan & Associates on this venture, we’re starting to get a bit more clear on how those who want content around immigration law are likely to want to receive it and use it.

Our short journey and interlude at the LIV Bookshop, whereby you can buy a legal reference book which costs you over $500, and those who want and can put to good use the information and content in this book do not hesitate to pay that amount, reminded me that in a really perfect niche the economics are quite different to a mainstream product. With a really important legal tome you may only sell a thousand copies of a version, however 1000 copies at $500 is not a number to sneeze at.

As my life rolls on and so much around me appears to become commoditized I really get interested and excited in those perfect niches where small groups of people congregate, and they congregate around content and ideas that have a really premium value to them. That to me is a perfect niche and I’m looking out for more of those in 2010.

For those of you who are interested in Australian migration law or have someone in your world who needs to get across what’s involved in migrating to Australia, don’t hesitate to refer them to our site www.migrationdigest.com.au. There are two definitive guidebooks available for sale – Migrating to Australia: The Guidebook which is a definitive overview of all bar the tourist visa categories, and Business Skills Migration: The Guidebook a comprehensive guide to migrating to Australia under the business skills and investor visas. You can also sign up for a free weekly digest about all the latest in Australian immigration news and trends at the Migration Digest website.

Niche Content Millionaire is a downloadable eBook that tells you the true story how we made millions from subscription content and membership websites. Buy Niche Content Millionaire Now