Pay Peanuts, Get Monkeys...

I honestly just can't believe some people sometimes.

OK, this is going to be a bit of a rant, and it may get a bit ugly...

I've been working with a potential client for about 3 months now. She approached me to build her duplex project for her. I met with her one evening, went through her plans with her, went through her wants and needs etc...and then I asked the magic question..."what is your budget?"

She gave me a figure of $1m.

One always wonders about someone's honesty at this point, and I have to confess that I wondered whether she was bull-shitting me with this number...

Now, her plans were brilliant! Completed by an excellent architect at a cost to her of about $25k. One would assume that if they've spent THAT much money on architectural plans alone, then they'd pretty much want to ensure that the building that ends up the final product is a fair and honest representation of those plans? I thought that was a very fair assumption to make....afterall, why spend that much bloody money on plans if you don't intend on creating what's been drawn?

Anyway...I ring her a few weeks later after spending countless hours pouring over the plans, getting quotations and the like, and I tell her it's not going to come in at her magic million figure and would she still like me to proceed with the quotation? Yes, she would.

So, I arrange to meet with her a week or so following that conversation and present to her a complete 20-odd page quotation complete with provisional allowances specified, photographs, individual costing blah blah...the whole lock, stock and barrel.

The first question I asked her at this presentation meeting was "How much did your architect tell you this would cost?" Her reply was $2,500 per square metre. With a smile on my face I showed her my breakup that came out to $2,560 per square metre! My price came out to about $1.4m including GST.

I went through the quote and each individual item with her, showed her the corresponding quotes from relevant sub contractors so she could ascertain for herself that the price I've given her is an honest price that accurately represents the plans she's provided to me.

Her plans were brilliant - and the level of detail was fabulous. The project included open tread stairs with solid timber treads, shadow-line detail around every single ceiling, skirting and architrave, custom wardrobes and joinery, timber floors, built in fireplaces and all sorts of other bits and pieces to make a spectacular property. It's a job I could really sink my teeth into.

So, anyway, I call her a few days after our presentation and she tells me she's a bit surprised at the price. And that she really only has $1.1m to spend, and that she's already received a quotation for $960k!!!

WTF? How on earth can I be $500k more than someone else, I wondered. Then I wondered...didn't you tell your architect what your budget was?

Subsequently, I rang her architect to get some intel on this, and he confirmed that he did tell her it would cost between $1.2m and $1.4m to build.

I asked her if she would like me to have a look at it, and come up with some suggestions as to how to reduce the costs. I also told her that it's virtually impossible for the project to be built for that price. We all buy the same steel, we all buy the same concrete, we all buy the same bricks blah blah blah, so this other person must be cutting some corners somewhere.

So, back to the drawing board and another few weeks spent combing over the plans the see where costs can be cut, construction methods changed so that her (tight) budget can be accomodated.

I did it!

I removed all the shadowline detail, I included tiles instead of timber in some areas, I made the stair cases concrete instead of open tread (would you believe the open tread stair cases came in at $20k each???), and made a raft of other changes that all have an effect on the bottom line.

I managed to get the cost down to $1.135m...and at our meeting on the weekend I told her I'd wear that additional $35k so she hits her magic (revised) number. She brings along her 26year old nephew to the meeting as well, who has apparently had some experience in the construction game as a client.

Anyway, the meeting goes very well and I walk away thinking I'll get the job.

I ring her this morning and she says my price is still too high and her other quote includes everything!! I haven't included air conditioning (excuse me love, but you're NOT allowed to put air con in this project due to Basix commitments), I haven't included demolition (excuse me love, you told me NOT to), I haven't included Section 73 works (love, that's a developer expense, not a builder expense) and I haven't included open tread stairs.

Those 4 items alone add up to around $100k!

I was fine with her comments about the demolition. I told her on the weekend that if it were a deal breaker, I'd talk about it more. I was fine with her comments about the air conditioning; I'd told her several times that she can't have it and if she put it in she will be told to take it back out again.

BUT...when she told me about the open tread stairs I honestly wanted to jump through the phone line and ram her f*****g head against a brick wall. Can you tell I'm angry now?

YOU STUPID WOMAN!

You asked me to cut costs to meet your budget. Those stairs cost $20k EACH...that's $40K I've saved you...and now that's a deal breaker? This is what I was thinking, I wouldn't dare talk to someone like that.

What I did say though, was, "Now, I don't believe that. I'd really like to see that other quote". Mind you, I've asked to see it before, but she's always rebuffed me, and I've never insisted. But, when she started talking about those open tread stairs, then...I'm seeing red. Naturally, I remain calm and talk to her normally. She replies "well, when I sign the contract I'll send you a copy of it"!

So, she's going with someone else.

People are F****D! Seriously. Champagne tastes on beer budgets.

When are people going to realise that the cost of something is the cost of something?

Anyone heard the old adage "you pay peanuts you get monkeys"? Well, same applies to the construction industry. You want quality...good quality...then it costs money.

Do you honestly expect me to turn up to work everyday for the hell of it, because I've got nothing better to do? NO! It doesn't work that way. I need to get paid too, and if I don't get compensated for my time, expertise and knowledge adequately, then guess what? I don't get HOME WARRANTY INSURANCE...If I don't get Home Warranty Insurance, I can't work!!

Sure, I'll cut my margins, I've done it before, and I'll continue to do it where necessary, but there's only so much one can do this before the better alternative is to sit on my arse doing nothing other than collecting a government hand-out.

So, she's off to employ some stinking builder from the western suburbs who hasn't got any clients in the western suburbs looking to employ a dodgy builder who cuts corners.

REALITY CHECK PEOPLE...things cost what they cost; there is NO escaping that.

I need a drink!

.../rant off

This is me...

I should probably write a bit of a bio on myself so if anyone bothers to read this blog they can at least know a bit about the woman behind it...so here goes:

I'm in my mid 30's, have a husband and a couple of children and the complete catastrophe of a household that that entails, which is pretty much on the go all the time. And somewhere in there I also find time to attend to work and extended family and social committments.

I do work, I work fulltime (well, as best I can juggling school hours). I'm fortunate, however, in that I'm self employed, so I have tremendous flexibility. Honestly, I don't know how women do it raising a family and working fulltime proper! Hats off to them as I couldn't cope.

So, amongst all that, now I have this blog too, which I'm really excited about.

I was raised in what some would call a Regional city in NSW and moved to the big smoke all by my lonesome when I was 17. What interesting times they were; young and naive and in a completely different city, totally broke. I was earning $180 a week on a traineeship and paying $100 of that in rent each week for a shitty little unit.

My childhood was less than ordinary. I suffered physical abuse quite regularly and was kicked out of home numerous times. I distinctly remember that fork in the road when I was 15. I looked at my mother (who was now seperated from my father), 30something, broke, working part time and destined to see out her days on a measly government pension. My choices were to either continue on the path I was on and end up like her, or make something of myself and rise above the adversity that I was experiencing.

I chose the latter.

I've been self employed in various sectors of the property industry since I was 22 years old. I've built an empire, lost the empire and am in the process of rebuilding the empire again, albeit with much more wisdom.

Not that I wasn't wise when I lost my empire (which was only very recently). I lost it only because I wasn't in control; I was at the behest of my financiers and in the end I was merely a puppet in someone else's show. I trusted in my financiers; "we want to help you grow; we're your partners in business; if you do 'this' we'll do 'that'" they would say, and I had no choice but to believe them. In the end they shafted me good and proper.

But, I've recovered; stronger, smarter and more determined than ever.

I've always had a bit of a dislike for banks. When I started my first business when I was 22, by the time I was 23 I wanted to expand it as it was going fantastically well. I approached my bank for a loan to expand the business and they refused to help.

Then they had the audacity to call me for a satisfaction survey. My exact words, and I still remember them today, were "go and get f****d. The day I don't need to rely on the likes of you will be my happiest day ever!" Needless to say, I gave them the shittiest satisfaction rating I could give.

My current aspirations include honing my writing abilities, raising my family, rebuilding my empire and potentially entering the political arena or corporate business arena.

When I say rebuilding my empire, I don't want to be the next Harry Triggaboff or Frank Lowy; I just want to be completely comfortable with a home completely paid off and at least $200k per annum in passive income. That is substantially more than enough.

I just don't want to have to worry about the bills that come in and stress about how I'm going to pay for them. I want to buy nice clothes and not even look at the price tag, and I want the power of choice! Essentially, that is what money brings. It doesn't bring happiness, it doesn't bring health or relationships - it brings choice!

I read a quote in the BRW once and it went "money doesn't buy happiness, it only alleviates misery". Having had money before, I think it's quite true.

I've dabbled in corporate business life, and I didn't like it at the time, but I'm wondering if maturity on my part may see me enjoying it now that I'm older. I just don't like the whole 9 - 5 routine (or 8 - 6 these days) and I enjoy the flexibility of self-employment.

Anything else you want to know?

The Surge of the $AUD

Lately I've been hearing financial commentators praising the surge of the $AU in comparison to the $US and boasting that parity may soon be reached.

I have to ask, why is this such a great thing?

I'm no financial guru, but in my layman's way of thinking having the $AU on parity with the $US is not such a great thing.

Why?

Well, it's simple; it means the cost of imported goods will drop. That's great for the consumer in all of us, but what this does is 2 things:

1) makes the money spent in this country leave this country;
2) contributes to inflation.

Now, what happens when inflationary pressures start rearing its head? That's right...mortgage interest rates rise.

Having a "stronger" $AU also does something else. It makes Australian exporters more expensive and less competative in the global market. That can't be a good thing for our local business or the national economy as whole, now can it?

Our country literally survives on our exports, from mining, farming, engineering and manufacturing. If all those products become more expensive because of the rise in the $AU there will be less exports, which in turn means less taxes and so it goes.

On the flip side, it does mean that we can travel and have our dollar go farther, but I think that's a rather short-sighted and narrow view.

What do others think?

If they were my kids...

I was listening to the radio yesterday morning and I heard a story about a man...

He was a taxi driver, I think, and he stopped to pick up 3 female passengers in the very early hours of Sunday morning.

Just a routine job, I bet he thought.

How wrong could he have been.

Allegedly, he was dragged out of the car and one of the passengers jumped in to the drivers seat, ran over him, and then reversed back over him!

The passengers were 1 x 21 year old and 2 x 15 year old girls! And which one was driving? One of the 15 year olds!!

What the hell are we doing to our kids today that they end up doing something like that...at 15 years old???

And where on earth were the parents of these thugs? What on earth were 15 year old girls doing out and about in the early hours of a Sunday morning when they should have been home in bed....sleeping?

Something is seriously wrong with some people!

Fool me once, shame on you...

Fool me twice, shame on me!

Finally, after some 17 or so days we finally have a Government.

Not the Government that the majority of Australian's wanted, but a Government none the less.

Not the Government that will manage the economy better, but a Government none the less.

Not the Government that will lay a steady hand on issues moving forward, but a Government none the less.

A rainbow Coalition; a traffic light Coalition; the watermelon party - call them what you will.

The decision to install the Gillard Labor Government was expected by many given the tight count on either side. And whilst the process of installing the Gillard Government may have been constitutionally sound, it was fundamentally flawed to say the least.

How can a party who won 73 seats (versus 72) and 44% of the primary vote (versus 38%) not be given the power to run the country? Is it not clear that the majority of Australian's wanted a Liberal/National Coalition to run the country? It's clear in my mind.

This happened due to two things that operate within our system:

1) preferential voting, and
2) the self-serving nature of human beings.

In a previous entry I made reference to Labor winning as many seats as they did soley on the back of the preferences they were given. A few of the independants won their seats on the back of Liberal preferences! So, the question begs, how can a preferential vote have the same value as a primary vote? If we didn't have preferential voting then I'm confident that it would have been a complete Labor wipe-out.

So, why did the independants Oakeshott and Windsor decide to cast their vote in favour of a Gillard Government?


Well, when queried Tony Windsor made the remark that if he didn't then another election would be required and Tony Abbott would win.


Now I have to ask...what sort of childish, vindictive, disgusting, unprofessional remark is that? Is that another way of him saying "I'm ready to retire, and I really only want to do one last term, so let me have it"?

Oh! How could I forget this beauty also said by Tony Windsor with reference to the NBN, "do it once, do it right, and do it with fibre".

Is this guy stupid, or what?

Tony, ever heard of wireless, buddy? It's the next big thing. Don't you realise, mate, that by the time the NBN is completely rolled out that it will have already been superceded by newer technology? Where on earth did you get your advisers from?

By the way, where's the business plan for the NBN? Did you read it? Did you even see it? No! Wait! THERE ISN'T ONE!

I can't not make comment, either, about Oakeshott's speach. Oh My Goodness! I counted 22 minutes of grandiose, self-indulgent, self-serving tripe.

"It's going to be ugly, but beautiful at the same time"....OMG....where did this guy come from?

And...guess how much it has cost US, THE TAXPAYERS for them to cast their vote with Gillard? Ten Billion Dollars. Yes folks, that's $5b a vote!

Democracy My Arse!

Tax cuts made simple...

Let's put tax cuts in terms everyone can understand.

Suppose that every day, ten people go out for dinner. The bill for all
ten comes to $100.

If they paid their bill the way we pay our taxes, it would go something like this -
The first four (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh $7.
The eighth $12.
The ninth $18.
The tenth (the richest) would pay $59.

So, that's what they decided to do.

They ate dinner in the restaurant every day and seemed quite happy with the arrangement, until one day, the owner threw them a problem. "Since you are all such good customers," the owner said, "I'm going to reduce the cost of your daily meal by $20."

So, now dinner for the ten only cost $80. The group still wanted to pay their bill the way we pay our taxes. So, the first four were unaffected, they would still eat for free.

What about the other six, the paying customers? How could they divvy up the $20 windfall so that everyone would get their 'fair share'?

The six paying customers realised that $20 divided by six is $3.33. If they subtracted that from everybody's share, then the fifth and the sixth would each end up being 'PAID' to eat their meal.

So, the restaurant owner suggested that it would be fair to reduce each person's bill by roughly the same amount, and proceeded to work out the amounts each should pay.

And so -

The fifth, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33% savings).
The seventh now paid $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. The first four continued to eat for free.

Once outside the restaurant, they began to compare their savings.

"I only got a dollar out of the $20," declared the sixth, pointing to the tenth diner "but they got $10!"

"Yeah, that's right," exclaimed the fifth. "I only saved a dollar, too. It's unfair that they got ten times more than me!"

"That's true!!" shouted the seventh. "Why should they get $10 back when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four in unison. "We didn't get anything at all. The system exploits the poor!"

The nine surrounded and beat up the tenth diner.

The next night the tenth diner didn't show up for dinner, so the nine sat
down and ate without number ten. When it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

That, boys and girls, journalists and college professors, is how our tax
system works. The people who pay the highest taxes get the most benefit froma tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table any more. There are lots of good restaurants in Europe and the Caribbean.

David R. Kamerschen, Ph.D.
Professor of Economics
536 Brooks Hall
University of Georgia

I thought I'd give a plug to this outfit...www.kiva.org

For those who haven't heard of Kiva, it's a micro-loan manager.

Essentially, you make micro-loans in the amount of $25USD to burgeoning businesses in less fortunate parts of the world. I personally have lent to people in Peru, Honduras, Vietnam, Bolivia and others that slip my mind at the moment.

How it works: if there is an entrepreneur who requires a $100 loan to buy stock for his stall, Kiva and their field partners will raise those funds from 4 separate individuals in $25USD blocks.

The loans are repaid generally over 12 months or a little more, however, they are interest free loans.

The best charity one can give is to help people help themselves. I just wish I knew of a similar program for Australian entrepreneurs out there giving it a go.

Housing affordability...

I'm so over the constant chatter of a housing affordability crisis and lamenting of the first home buyer.

I've said it before elsewhere, and I'll say it again here...there is no such thing as a housing affordability crisis!

The crisis is that the younger generation think they can have everything they want when they want it and on their terms.

Well sorry to say, all you youngin's...it does not work that way!!!

Just because you grew up in a suburb that now has a median house price of $800,000 does not mean you must buy your first home in that suburb. That you do buy a house in that same suburb is merely a discretionary decision you make during the purchasing process...not a right that you are entitled to.

So, if you can't afford to meet the market in your suburb?

How about a unit? Substantially lower entry costs...

How about a different suburb? Again, lower entry costs depending of the dynamics of that different suburb.

For goodness sake...units in my area of Sydney, which is a lovely area reasonably close to the CBD, start around $350k...you can't tell me that in this day and age, for someone that is working, that this is unaffordable.

Get a grip all you young ones and learn to start at the bottom, do the hard yards and work your way up, just like everyone else!

What a wonderful world...

Sometimes you just hear something that touches you, and makes you think to yourself "wow, that's beautiful".

A while ago I was driving home from a rather boring and difficult meeting and I tuned in to my favourite talk-back radio station. They were talking about how expensive it is to die, the cost of the grave site, the tombstone, cremation and even the requirement of a permit to allow the scattering of ashes.

Anyway, this woman calls in and says that she's 85 years old, and her husband is 87 years old, and today they're celebrating their 65th (!!!) wedding anniversary. How fantastic is that?

She then remarks, "we don't have time to think about dying and cremation and all that stuff, we're far too busy being in love and enjoying our lives together".

Now, how beautiful is that that an 85 year old woman can say she's still in love with her husband.

I hope that's me in another 50-odd years or so!

There's an L in there...

It's not Austraya...

It's Australia.

There is an L in there.

I wish people would get it right!

Wilkie puts a nail in the country's coffin...

So, Andrew Wilkie, independant elect in Tasmania has put a nail in the coffin that is this country; announcing yesterday that he would support a Labor minority Government.

I haven't read his press release, but I've heard snippets of it played on the radio and tv. I believe, and someone can correct me if I'm wrong, that he made reference to Labor's economic management and how he feels that it would be better than the Coalition's management.

How is that so?

Treasury announced that the costings of the Coalition's policies show up an $11b hole, and the Coalition have retorted that there are differences in calculations used by the Coalition as compared to those being used by Treasury.

How on earth can Treasury calculate their interest payments based on a 4.9% interest rate?????

Talk about having their heads up their backsides! Please Mr Henry, can I have some of that money that only costs 4.9% because the best I can get right now is about 7.9%! The banks, if you remember, didn't even pass on all the interest rates cuts that the RBA announced over the last 2 years, so I'd really like a bit of what you've got.

What a joke.

Anyway, even if there were an $11b hole in the Coalition's figures, isn't it a whole lot better than the $43b hole that is the NBN in Labor's costings? I should think so! Labor is so concerned about this NBN that they haven't even put it in the budget...talk about great economic management! If the CEO of a publicly listed company did that surely he'd find himself in the do-do big time?

Morons.


I was reading the BRW last week (volume 32, number 33) and there was a letter published on Page 16 (Letters to the Editor), and I thought I would reproduce it here. It was authored by a Mr Michael Johnson.

Did we really deserve this?

They say we get what we deserve. Never has this been more true than in the 2010 federal election.

Sadly, the outcome of the former prime minister John Howard's "comfortable society" is a country that is seemingly devoid of vision,
of leadership and has the political conversation of that of a small, inwardly focused aged-care ward.

In 2010, and at a time when someone needed to stand up, both parties chose what they believed was the safe route.

They chose to focus on the title of power not what is required of those who will wield this power on behalf of all Australians.

What the country is calling for is a vision for the future. A vision that is more than what we are at present or what we have been historically.

Australia needs a vision and a sense of purpose that harnesses the ethos of the clever country through an innovative industrial sector, that proudly claims the value-adding opportunities that our rich natural resources provide and delivers equality of opportunity that underpins the now-cliched term "a fair go for all".

The greatest tragedy is not what has been said, claimed and done, but
what has been left unsaid, ignored and removed from the national
conversation".

He's probably not wrong!

Book Review...

I recently finished reading a book I'd heard mentioned on my favourite talk back radio station.

The book is called "Betrayal" with the tagline "The underbelly of Australian Labor".

Don't you just love how underbelly has become the new descriptive for everything that's not-so-kosher?

Anyway, it's written by a guy named Simon Benson, whom I believe is a senior political journalist for the Daily Telegraph newspaper (my apologies to Simon if this is incorrect).

It's all about the NSW Labor party and in particular, the nameless, faceless, power-hungry, factional puppeteers behind the scenes. A large portion of the book talks about the attempted privatisation by Morris Iemma (former NSW Premier) of the state's electricity networks, and the struggles involved with that.

It's probably quite evident already that I am not a Labor supporter, but I must say that Morris Iemma was treated pretty bloody poorly by these people.

And, I must hand it to Michael Costa - what a character. I do admire his straight-shooting style. He says what he means, and means what he says, and I believe that he genuinely had the state's best interests in mind in the carriage of his role as Treasurer.

The book is a fantastic snapshot into how Labor runs its politics, and I've got to say that I finished the book disliking Labor more than I did before I started reading it!

It also goes some way to showing what Kevin Rudd (former Australian Prime Minister) is like. If only we'd had this book before Kevin 07!!

Paul Keating (former Australian treasurer, then Prime Minister) was quoted as saying "...where goes NSW, so goes Federal Labor".

If that's true, and I believe it is, then that's a real worry!

For anyone who's interested in politics, then I'd recommend this book. It was a good read, entertaining even.

PC on overdrive...

gay a. (-er, -est) happy and full of fun; brightly coloured.

"Kookaburra sits in the old gum tree
Merry, merry King of the bush is he
Laugh, Kookaburra, laugh
Kookaburra, gay your life must be"

My punctuation of this old classis song is probably incorrect, but that's not the point of this little rant.

I swear, the world is going barking mad!

What on earth is wrong with the word "gay" in this song?

Well, some PC mad Principal at a Victorian public school thought there was something wrong with it, so he's banned the word and instead, replaced it with the word "fun".

What next for crying out loud?

The Power of the Individual...

I was watching the Insight programme the other night (on SBS, I think), and the topic for the night was the state of the future Federal Government.

Mr Michael Lavarch (former Attorney General and now Dean of Law at QUT)made a very interesting point that I haven't heard raised anywhere else yet, and it was this (in my words):

It's not only the independants that wield so much power in the new Government (regardless of which team wins the battle), but any single individual of the 150 member Parliament has the potential to create havoc.

All it will take is one single MP to have a dummy spit about his electorate not being looked after as much as the next person's electorate, and if he doesn't get what he wants for his electorate all he need do is pull the pin, and down comes the fragile house of cards.

Now more than ever, each team will require complete loyalty and discipline from their players.
Stability? My arse!