Opinion
- There’s nothing like inertia in the face of a downturn
  
  Do you remember the big fanfare when Tourism Australia launched its ‘There’s Nothing Like Australia’ campaign, and invited the nation to share its favourite Australian places and experiences with the world? I’m sure you do, we wrote about it extensively at the time, and TA managing director Andrew McEvoy even wrote a column for Thumbrella urging the backpacking sector to get involved. Read more »
- Here’s how to cash in on the gap year boom
  
  In this guest posting, Gapyear.com founder Tom Griffiths tells you how to cash in on disappointed UK students who miss out on a university place this year.
  
  UK media reports that 200,000 young people will miss out on university places this year may be overhyped – in truth about 100,000 don’t normally get in anyway – but it’s still a shocking statistic. And an opportunity for you guys Down Under to cash in. Read more »
- Lonely Planet – the gift that keeps on giving
  
  There’s nothing my kids hate more than hearing me start a telling off with the phrase “when I was a kid…” It usually follows them taking an ordinary household item – like the family computer – for granted. Read more »
- ATEC could do worse than appoint the next Matt Hingerty to replace the last one
  
  As a long-suffering England soccer fan, I’ve noticed a trend in the way the Football Association appoints the national team manager. That is, it tends to go for the polar opposite of the man who went before. If you don’t believe me, here’s the recent evidence… Read more »
- Another Wicked piece of marketing
  
  I’ve written about this before, but once again I have to confess to a sneaking admiration for the PR and marketing expertise of John Webb and Wicked Campers. Read more »
- Grounds for cautious optimism, but things could get worse before they get better
  
  Just got back from a couple of weeks in London – surely the world’s most depressed capital city at the moment, but more of that later – and everyone I speak to seems to be 20 per cent down. Read more »
- BOA successfully talks up the ‘Gong and south coast
  
  BOA president Katrina Greeves’ wrap-up on last week’s regional meeting in Wollongong.
  
  Over 10 local South Coast tourism operators joined BOA Committee representatives and members at the ‘BOA Talks South Coast’ event in Wollongong last Thursday to engage in lively debate regarding travel and tourism issues affecting the backpacker, student and youth market in the south coast region. Read more »
- What prison taught me about discounting
  
  Founder of Brokepacker.com Kevin Lippy explains there are three types of discounting ahead of the website’s launch tonight.
  
  A prison yard is a tough, volatile, dangerous, cut throat and an extremely unpredictable environment… Kind of like the Australian backpacking industry during low season. Read more »
- How many backpackers does it take to change a lightbulb?
  
  Thumbrella is conducting an exclusive industry survey this week, with just one question. How many of your customers are idiots? Read more »
- How’s business?
  
  So, how’s business? It’s a simple question, but it seems there’s no easy answer. Read more »
- Australian backpacking is the pulse we watch to gauge the health of the industry worldwide
  
  In this guest post, gapyear.com founder Tom Griffiths relects on the recent ATEC Backpacker and Youth Industry Conference and why Australia’s backpacking industry still leads the world.
  
  Like most of the delegates I spoke to, I found the recent ATEC Backpacker and Youth Industry Conference extremely interesting and useful. It’s very easy in these current times to set a safe agenda to cater for an industry licking its wounds, who want to hear good news stories and see rainbows ahead. Read more »
- McEvoy: ‘Put your tourism experiences on the map’
  
  Tourism Australia managing director Andrew McEvoy discusses the first stages of the There’s nothing like Australia campaign and urges the industry to get involved. Read more »

What happens when the cash runs out?

When the cash runs out in a business, everyone takes what they can to salvage something from the smoking ruins.But is it not smart for a supplier to take precautions to improve their position before the cash runs out, and before the liquidator moves in? If so, read on…
In most businesses, the finance supplier (the bank) will have taken the precaution of a registered debenture charge over the business. A debenture charge is like a mortgage which ‘floats’ over all the assets of the business, until the bank appoints a receiver, when it ‘vests’ over all the assets. Unless a supplier has taken precautions, it stands in line after the bank has recovered its money in full, as an unsecured creditor.
Three precautions stand out for suppliers, not only in the tourism industry, but generally.
The first precaution is that the supplier retains title to the goods or stock supplied to the business until payment is received. How is this done?
A retention of title or ‘ROT’ clause is inserted into its trading conditions. Using a ROT clause, a supplier can remove unpaid goods from the business premises even after a receiver or liquidator is appointed, because title has not passed to the business (no payment has been made).
The second precaution is that the supplier includes the right to lodge a caveat over the real estate of the proprietor of the business, in its trading conditions.
This will allow the supplier to recover their debt, whenever the property is sold.
The third precaution is to establish a regular payment pattern, such as cash on delivery (‘COD’), calling by to collect every Friday or insisting on payment in the first week of the month.
As a last resort, do what a certain meat wholesaler does which is to arrive at the butcher’s shop on Friday afternoon – the busiest day of the week – and take cash directly from the register to pay the debt.
So don’t dream of what might have been when the cash runs out, take precautions now.

Australian travel and tourism lawyer Anthony Cordato contributes a regular column to Backpacker Trade News. Got a question for Anthony? E-mail ian@backpackertradenews.com or visit Anthony’s website, www.tourismlegal.com.au.

By Martin Lane · September 18th, 2008 at 3:22 pm