And another one bites the dust!
2014 was characterised by the effects of the downturn in the mining industry, the local property industry flat-lining, puzzling political decisions and a lingering hangover from the GFC.
As we enter the New Year, we need to consider what’s in store for 2015. Here’s my thoughts:
- Fuel prices. As has been the case over the last 30 years that I can remember, fuel prices in Rocky will be dearer than Gladstone or Mackay. The justification for the fuel price rip-off will continue to be transport costs. I was interested to hear on the radio (so it must be right) that baked beans are the same price in Brisbane and Cairns - so obviously transport of baked beans can occur at zero cost.
- Interest rates. There appears to be an increasing prediction amongst economists that there will be at least one more rate cut before any increases. As I wrote in a previous column, the prediction for home loan interest rates over the next 5 years is relatively stable. The reserve bank’s reluctance to change interest rates is a fair indication that they do not expect economic activity to improve significantly in the short term. Maybe this is as good as it gets?
- Smart businesses will survive. Difficult economic times generally will ensure that only the strongest businesses will survive. To be a strong business means that your business must address a real need in your target market, you are able to market effectively to that target, your service delivery will be memorable and your financial management must be excellent. If you need help with any aspect of making your business a strong business, you need to talk to us.
- Cloud computing. The rapid pace of advancements in cloud computing will continue well into 2015, particularly in the area of accounting. A recent survey indicated that by the end of 2015, almost 90% of small businesses will have their accounting records in the cloud. Whether that is achieved, it is clear that a significant majority of businesses will be using cloud based accounting systems and increasingly it will become a case of “why aren’t you doing it?”
- Political instability. The inability of the Australian political system to create stable and effective government will no doubt be a continuing feature of 2015. While we allow “lunatic fringe” groups with no real electoral support to dictate what can happen in our economy, we are doomed to lurch from ineffectiveness to downright stupid.
So although we approach 2015 with a degree of hope, it’s certain that the new year will bring its share of challenges and opportunities.