Park Beachside is a fast growing real estate firm situated in the heart of Sydney’s eastern beaches. Established in 1993, they provide both rentals and sales services and are one of Sydney's leading executive property agencies. Positioned at Coogee Beach, halfway between the city and airport, Park provides services to the growing mobile population.
Dirk Hertford, General Manager, shares his insights on running a successful business, the importance of being a member of NSW Business Chamber and what keeps him awake at night…
What has made your business so successful?
Managing cash flow efficiently has been very important to the growth of our business and its success. When Park Beachside first started, we weren't very sophisticated with cash flow management. It was just money in money out. Over the years we've learnt a few techniques that have allowed us to grow the business faster than would have been possible otherwise. In real estate, our sales commission is delayed as we don't get paid until settlement of a property. We're working for a few months on a sale before we actually see any money, and with off-the-plan developments it can be years.
The importance of limiting expenses and increasing income goes without saying. Cash flow management is about getting your timing right. Whenever we set up a new account for a good or service we push for the best payment terms, such as a credit account for 30 days. Suppliers who give credit are preferred over those who don't. Any large expenses, such as insurance, are organised as monthly payments rather than annual payments.
When we are paid, we leverage the money coming in. We make early payments to those suppliers who give discounts for early payment and have an interest bearing account to generate some extra income while we’ve got the money.
Do you have any advice for other members, based on your experiences and success?
None of this advice is rocket science but it’s all been very important to the success of our business. You have to have a good cash-flow forecast. We have a cash flow projection and while it can't be precise, as it’s predicting the future after all, it does give us the right focus. Being forewarned is forearmed. If you are alert to issues early enough you have the time to adapt.
Get into the habit of regularly reviewing your cash flow management, which is a fancy way of saying work out when, and how, to make payments that work in the best interests of your company.
Have good, reliable processes that capture, manage, measure and analyse all the factors that affect the profitability of the business. With this information, you should be able to undertake a cost benefits analysis highlighting where the results don’t match your targets, what needs to be dropped and what needs to be better managed. It should also highlight your most valuable customers and the most profitable parts of the business.
Get into the habit of reviewing your business plans regularly. They should never be set in concrete. A regular review allows you to easily adapt to changing circumstances. You need to ensure that you are still on track, especially with your budget, and make sure you have contingency plans in place. And finally, know what your competitors are saying, doing, and charging.
How has membership with NSW Business Chamber helped your business?
We find our membership with NSW Business Chamber invaluable for a number of reasons. We have used the NSW Business Chamber Advice Line when we have had specific questions about workplace issues and in each case one of their specialists helped us make the right decisions and take the right approach for our business.
We have gained confidence from knowing the NSW Business Chamber can give support if certain problems arise. It’s a bit like insurance... it provides peace of mind knowing that you are acting with the guidance of a trusted advisor by your side.
Whenever we can, we attend local networking and information events and these have proved useful in increasing our business knowledge and building contacts. The expansion in contacts and knowledge is hard to measure as it has had widespread impact across the whole business.
Getting involved with NSW Business Chamber’s South Sydney Regional Advisory Council has enabled our team to mix with other businesses and discuss a wide variety of business issues.
The Business Connect magazine helps improve our team’s business knowledge and this is yet another way of gaining business support and business information from the Chamber.
What recent business achievements, successes or wins have helped grow your business or raised your profile?
Park Beachside has expanded its rentals and sales market share through increased marketing and growing referrals. The number of properties managed and sold has been growing. We have been achieving double-digit growth each year, including during the Global Financial Crisis.
Our team is strong and growing stronger. We have successfully developed high performance agents in both rentals and sales which, in turn, has grown the results.
Chairing the Holiday & Short Term Rentals Chapter for the Real Estate Institute of NSW has provided us with greater contacts, and learning about how similar businesses across NSW operate has helped to improve our systems and practices.
Every two years there are business awards held for businesses in Randwick City. Park Beachside is extremely proud to be the only real estate office to have been selected as a finalist in both of the last two awards, in 2007 and 2009. We look forward to this year’s awards.
Do you have any business concerns that are keeping you awake at night?
Two things:
Stifling regulation is having a deadening impact on growth. Some overseas contacts come out here and say "there is no pulse".
Finance for business growth is proving a tough challenge. We are currently looking at expansion and it’s hard to get the money to move up to the next level.
Is there anything in the business world that is exciting you?
The increasingly mobile population is opening up more opportunities to service more customers.
I still continue to be ‘auto university’ trained, using CDs in the car for business skilling. I’m interested to see if new cars with iPods and downloads can expand the range of audio resources available.
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