“To provide cost effective and efficient water delivery services to the Theodore region by a local team that’s committed to customer service, community engagement and growing the regional economy.”
Sustainable/long term future – the business will be developed so that the intergenerational operation of the water delivery is capable of recovering the total costs from water charges and other revenue streams. The cost of replacing assets in future must be provided within the cost base. The delivery assets will be maintained and renewed to achieve long term viable water supply to irrigators. A key aim of the business is to improve the viability of the Theodore region to provide greater resources to the area and increase demand for our products.
Modernisation – the assets will be modernised in order to achieve overall cost reductions per unit of water compared to current levels allowing for inflation. The modernisation must result in cost savings greater than the depreciation charges of the assets created. Modernisation will be evaluated to maximise the cost savings/ML including expansion of volumes delivered to reduce unit costs.
Affordable – the per unit cost base of the business will be constantly reviewed in order to reduce price pressure on the grower shareholders. This will include seeking additional income streams to offset fixed costs in the business, such as labour. We are a small scheme and we will seek opportunities to defray costs other than directly to our water users, such as shared costs. We will seek revenue outcomes that will partially defray costs as this will reduce per unit costs. We will not engage additional costs for other revenue streams unless at least direct costs (not including existing sunk costs) are met. The additional revenue streams ideally will offset direct costs and contribute to overheads. An additional focus will be to increase delivery volumes of water to defray the share of fixed costs and reduce water costs.
Efficiency/share administration services – the activities will be constantly reviewed for more efficient ways of operating to reduce per unit costs. Rationalisation of the existing structure will be sought provided the savings do not create additional costs for other customers or restrict their delivery of water. Non-commercial practices will be reviewed and cross subsidy practices eliminated, so that the water cost burden is fairly distributed. The business will cooperate with other distribution businesses to reduce the shared cost of administration.
Local jobs – a key strategy is to maintain regional employment. Existing EBA conditions will be honoured but surplus labour will be utilised to gain revenue streams from complementary activities in the region. Revenue streams will target opportunities that do not compete with
other local employment. The aim is to increase local employment where possible. The staff will maximise their use in internal cost saving roles.
Timely deliver/customer service/reliability – the business will have higher performance standards than the previous supplier and adjust its business to better meet the requirements of its customers where the costs are not excessive. The business aims to optimise functionality to its customers to improve the value of the service, while not substantially increasing costs. Delivery times and volumes will improve customer value. Rationalisation will improve customer value.
Funds investment/long term future – the business will seek to improve investment returns on surplus funds while protecting the capital. Risks will be evaluated on the basis of long-term investment for future needs of the business. The business will seek to maintain a healthy reserve balance to protect against unknown risks and future assert replenishment.
Key Deliverables next 5 years
- Modernisation implemented
- Implement all rationalisation from business case
- Create revenue streams to cover $80,000 of salaries, through in-house or external activities
- Share common administration areas with other schemes
- Increase water sales by 1500ML
- Maintain water prices
- Maintain reserves at $8m
- Create $240,000 annual investment returns
- Simplify employment arrangements