Quest for key to being small and successful in business

"If this sector doesn't kick on, we're buggered as a First World nation." - John Tamihere, Minister for Small Business.

To make sure it does kick on, Tamihere is holding a public meeting next week with Auckland business leaders to find ways to work together to benefit the small operator.

Those involved range from small owner-operators to mentoring organisers and the Chamber of Commerce.

Gaelle Deighton, chief executive of Enterprising Manukau, says there has been a lot of talk about the value and importance of small and medium enterprises (SMEs), but few actions that result in practical and useful support, advice and assistance.

Many groups have set themselves up as the "voice" of SMEs, and often their usefulness is more targeted at, and used by, the medium-to-large business sector, she says.

"In this category I place various industry associations such as the Chamber of Commerce and even Government agencies and initiatives.

"We need a radical rethink of the work that needs to be done, and some serious resources to support, encourage and build these businesses."

Alasdair Thompson, chief executive of the Employers and Manufacturers Association (Northern), says SMEs pay more than six times more in compliance costs per employee than larger businesses.

He believes they should be excused from meeting the full extent of their compliance obligations straight away, following the lead of Australia, Britain, Canada and Hong Kong, which focus on giving direct benefits to assist the rapid growth of SMEs.

In some parts of Australia, he says, an SME taking on staff is given time to see if the employment relationship will work out before the full weight of the law comes to bear.

Steve Bonnici, managing director of Urgent Couriers, says his owner-driver couriers, who are all small businesses in their own right, find it hard to meet their regulatory IRD obligations, largely because they do not understand what they are.

Employers and the Government could assist in bridging this gap.

Chamber of Commerce chief executive Michael Barnett wants the Government to reduce compliance costs for SMEs.

He points out that of roughly 300,000 New Zealand companies, only 8000 export, and 150 of these provide 80 per cent of foreign exchange earnings.

"We need to grow the number of exporters.

"We need to set a target, say 20,000, determine a timeframe, say 2010, and put in place an action plan to achieve this goal," Barnett says.

Ray Schofield, of mentor scheme Business in the Community, observes that the SME sector is very diverse and cannot be served by one person or one focused organisation.

Since one size doesn't fit all, the one-stop shop concept must be made up of affiliated or endorsed service providers being available to represent the wide range of requirements of SMEs, he says.

David Chapman, chief executive of the NZ Institute of Management, believes that an excellent way to strengthen the sector longterm is to start early, and educate young people to develop their potential to succeed as small business operators.

The focus needs to be on practical solutions that address the needs of the small business person.

He believes that an action-based research and learning approach is the way to go so SMEs can learn from experience and change.

Lisa Er, of Lisa's Healthy Foods, believes a collective voice for SMEs can be most easily created by providing industry representation under different categories since issues of manufacturing are vastly different from those of accounting or restauranteering.

All of this will be grist for the mill at a forum on Monday evening at the AUT Conference Centre as this panel seeks answers to:

* What is needed to ensure the success and growth of SMEs?

* How can SMEs have a collective voice?

* How can SMEs take a business leadership role?

* How can we work together to achieve these goals?

The forum is on Monday at 6.30pm in the centre in Penrose.

Anew NZ