Just days after cloud-based accounting software giant Xero announced that the lifetime value of its subscribers had grown 41 per cent to a whopping $3.9 billion, in the firm's latest half-year results - Xero's small business director Nicole Buisson talks to Hawke's Bay Today reporter Andrew Ashton on the growing importance of technology and mobile apps to small businesses - and why more single mums are becoming more important than ever.
How do small businesses deal with issues around affordability regards to increases in the minimum wage?
Whenever there's an increase in the minimum wage it does put pressure on small businesses, and there's a couple of pieces of advice that we do offer.
The first of those is to seek advice. It can be pretty lonely being a small business owner - 70 percent of our small businesses are sole traders and if you are new to running a small business as well, it can take a while to develop all the skills you need.
The biggest piece of advice probably, is to seek advice from your accountant in particular - they are the most trusted advisor of small businesses. Go and have a chat to them to find out how to manage payroll and budgets that can sustain your business.
The second piece of advice is get productive. So, we know at Xero, small business are using four to five apps are more productive than these who are not using any at all because it saves them time.
Small businesses need to become more productive and efficient, when there's things like a minimum wage increase. So, adopting new technology can help them do that. An example for that would be if you're a tradie and you're not using any software today, if you were to use Xero to manage your accounts, so your accountant did that for you and if you manage your jobs on the go, you get an app to do that. Simply by doing those two things, you would be a whole lot more productive.
How do you make sure businesses get paid promptly for work?
I think if you're a small business and you are invoicing by sending an e-mail with an invoice attached, many people will send that with bank account transfer details but one of the ways you can get paid more quickly - in fact, we know nine days more quickly - is by adding a "pay now" button to that invoice.
That makes sense because when the customer gets the invoice, rather than saying, "oh I have to do a bank transfer, I'll do that later", they can just click on the pay now option and the small business gets paid more quickly, which helps with cash flow.
What sort of things have you seen small businesses doing to attract talent to regions like Hawke's Bay?
Certainly we see, it's not just about wages. Company culture is important and lifestyle is important for New Zealanders, especially for people moving to New Zealand from abroad - they want the lifestyle that maybe Auckland doesn't afford them.
So more and more, we are seeing places like Hawke's Bay and Tauranga becoming business hubs as people exit cities for a better lifestyle. That's an important trend that we are seeing and one I have personally experienced, trying to get people to move to Auckland. Some of that is driven by house prices in Auckland and it seems to be a bit more affordable in Auckland.
We do lots of panels with businesses about hiring, and some of the things they have said recently are around it's hard to find people because we have pretty low unemployment in new Zealand, so we're having to get quite creative. Some of the things we are hearing, are one lady is hiring a lot of part-time mums, who are extremely qualified but can't find regular work because they just want to do hours between 9.30am and 3pm.
The other way people are getting creative is just finding part-timers in general, rather than full-time staff. So, that's a pretty important trend that we are hearing.
Xero is very keen on the regions, we opened a Hawke's Bay office, it definitely requires national support, which is why we are also running regional roadshows.
What's the main piece of advice you are giving to people at your Hawke's Bay roadshow?
It's largely around accountants primarily, so that's all around how to advice your clients about not only their accountancy needs but about the apps they might use to get productive, how you move to more of an advisory space as an accountant, rather than just a compliance role.