Same Story, Same Intent

Bowens Chief is Optimistic(!) this was the headline of the Builders Bulletin Vol 1, No 2, May edition 1990. At the time I wrote the following:

Interest rates have been so high for so long that problems now exist in every sector of the Australian economy. It is not surprising then to see pessimism pervading the general community. It is going to take more than the recent small drops in interest rates to give housing demand a decent boost. People are adopting a very conservative approach to the future and major decisions like building a new home are being postponed.  

It’s difficult not to get caught up in the doom and gloom syndrome. We are seeing the impact not only in our trade business but in our cash volume as well. 

However these times, while tough, are still abundant in opportunity. A time when good organisations prove just how good they are, when quality thrives and when first class service earns its just reward.  

It is the time when initiative is essential. Sitting back waiting for work to come to you will simply perpetuate pessimism.

Going after new business is providing worthwhile results for many of our clients. It is impressive to see and confirms our opinion that there is still plenty of work to be had. The HIA forecasts for the next 12 months are in fact quite encouraging.

A lot of homes are still going to be built and with land and material prices easing, plus trades being freed up, it really is a good time to be building. But you need to create your own demand. Please let us know of any way that we can help.

Here at Bowens we are not at all hesitant about the future. We don’t mind being put to the test. If it’s true that these are the times for good organisations to shine, then just watch our sparkle!

I started writing the February 2025 Bulletin with a similar punchy (optimistic!) view on the year ahead … that’s when I thought, wait a minute, I’ve written similar ‘stuff’ in the past. So I delved back to the second edition of 1990 and low and behold!!!

One big difference about this period 35 years ago was that the variable interest rate on one’s home loan was 17%. The average standard variable rate right now sits roughly at 7.02% … The unemployment rate is around 4.0/4.4% whereas 35 years ago it was around 11%.

Then in 2005 (June) Paul Dixon was my General Manager and he wrote: “… signs are now starting to show that the sales of new houses are slowing – and that will start to affect us (Bowens) in the next few months with possibly less orders coming through.” At the time we were coming off a buoyant period particularly through March, April and May.

Again in 2007 … John Bowen was then Managing Director and General Manager … and he wrote in the September edition under a heading of ‘Keep it Positive’. The media at the time were talking about financial markets being on the brink of collapse and, would you believe it, the issue of housing affordability was also in their sights.

In December 2008 John’s article was headed ‘Reasons for Realistic Hope’. It was a period of ‘faltering world economies’ and John emphasized the need to break the momentum of negativity and explore some rationale to which one could attach some of this ‘realistic’ hope. These included the low unemployment numbers that we were experiencing at the time, low rental vacancies, descending (low) interest rates, surging immigration – and one that is hard to believe in 2025 – ‘Australia’s capacity to integrate the economy with additional stimulus packages is very good. We are almost debt free and have improving terms of trade which compares favourably with the U.S. where a $10 trillion liability already exists! (Wow!)

However, challenges were also highlighted by John from negative sentiment issues … future pull back on immigration numbers, access to credit concerns, fall in government revenue from reduced stamp duty and possibly high inflation coming after massive liquidity injections of the Australian government and its international friends. John’s positive views plus good prospects from BIS Shrapnel and the HIA still left him with some doubt about the housing industry avoiding the ‘fall out’.

His final comment in December 2008 (17 years ago remember!) was “… at no time more than now would a crystal ball come in handy. Without the availability of this option, we must work to keep our businesses healthy as we prepare to benefit from the better times which will inevitably follow.”

Fast forward to 2025 and I would suggest that John and his/our team of wonderful people – through each of those 17 years – have overcome all obstacles and achieved beyond anyone’s expectations.

Moving on to 2010, it was all about independent family timber and hardware operators facing the onslaught of Woolworths into the large format hardware business – effectively taking on Bunnings. It was a David vs Goliath situation with the current planning minister ready to fast track planning assessments to allow Woolworths/Lowes USA to build on twelve new and large sites around Melbourne. Town planning issues were prevalent then as they are today and John’s argument was correct in the government favouring a Goliath like Woolworths while not waving this magic wand over several plans we had at the time.

Again, despite the challenges from both large and not-so-large competitors, from competing and quite disruptive building methods, Bowen & Pomeroy Pty Ltd has continued to prevail.

The economy’s ups and downs we can also continue to handle as long as we keep control of our finances including a disciplined approach to both our borrowings and growth opportunities.

It would have been fun to repeat word for word my 1990 article and left it at that – would have been cheeky to do that but I think I have highlighted the fact that while the world has changed dramatically in the last 35 years, the basic fundamentals in running a business remain the same, same and same again.