Q and A: Minister for Small Business, Stuart Nash

Napier MP Stuart Nash said the Government aims to support the backbone of New Zealand's business economy. Photo/ Supplied

Minister for Small Business and Hawke's Bay local Stuart Nash talks to Hawke's Bay Today reporter Andrew Ashton on how the Labour-led Government aims to support the backbone of New Zealand's business economy.

What are your long term aims for New Zealand businesses?
My headline ambition for small businesses is to support them to prosper and thrive. In turn this will encourage them to employ more staff and to invest in their local communities.

But how do we get to that place? Too many small business owners don't know about the range of services and assistance available to them to help grow their businesses.
Connecting those business owners to sources of information and support is a priority.
I will raise awareness of a number of initiatives when I embark on what you could call a Small Business Roadshow later this year. I will get out to the regions to highlight a number of government programmes and to listen to small business owners about what is working well and what is proving a challenge.
I can also make important connections to our taxation system through my other role as Revenue Minister. There are big plans in place for transforming the way tax is administered and collected. Yes, I know that sounds dry as dust to most people but believe me, it can make all the difference for a small business owner. I only need to mention Provisional Tax to some people to get their blood boiling!

What do you think are the main drivers of SMEs in New Zealand and what do you think needs to be done to help those business owners succeed?
The one central piece of advice is be prepared to adapt. That could be adapting for digital technologies, or climate change, or new markets, or changes in consumer behaviour.
Small businesses are looking at how they can be flexible and better skilled for a global market that is increasingly digital and specialised.
Seventy two per cent of our small businesses have internet sales. With the continued roll out of ultra-fast broadband more and more small businesses will need to go digital in order to remain competitive, let alone expand.
What this means in effect is they need to increasingly embrace e-commerce and be able to get their products and services into the best-paying markets. Those markets could be in Wairoa, the South Island, Australia, the Pacific Rim or more distant markets in Europe and elsewhere.
Large multi-nationals like Alibaba and Amazon are changing consumer behaviour in the way in which customers purchase goods and services, and the expectations people have around service delivery. We need to be on top of these changes, if we are to take advantage of them.
But that doesn't mean we should just blindly emulate them. Here in New Zealand, we have one more natural advantage. We have the advantage of our reputation. We have a reputation for high quality, for environmental sustainability, fair labour laws, and ease of doing business. These attributes provide us with a global competitive advantage that smart exporters leverage for their businesses. Ideally, I would like to find innovative ways for more SMEs to engage in export markets. While challenges are very real, the opportunities definitely exist for those who are ambitious.

How do you think the Government should ensure that the ratio of new startups failing after their first year is improved?
Business is inherently about risk taking. You will not find any politician who can seriously promise to end business failures, especially in the first few years after start up.
The Ministry of Business, Innovation and Employment has more information about this. Have a thorough read of the website business.govt.nz
I cannot emphasise enough – take professional advice and consider a business mentor if you think it will help. There are also some business incubators and business accelerators available.
Make sure your business plan is fully formed before launching your idea into the world.

Do you think Labour needs to boost its business credentials amongst businesses?
Business owners will agree with some of our policies and disagree with others. That's politics, but we have made it clear we are very keen to get alongside businesses and other major players in the economy in order to help drive productivity. We will play our part by keeping the Government's books in a strong position, which means keeping expenses and debt in check and running sustainable surpluses.
You might be surprised how many of us had business experience before entering Parliament. Personally I worked for large exporters and small privately owned companies across a range of industries.
Two of our newest MPs, Jo Luxton from near Timaru, and Tamati Coffey from Rotorua, are successful entrepreneurs. Jo owns a childcare centre, and Tamati has a café and bar, and both are proud to call themselves Living Wage Employers. They are well connected to their provinces, and they are giving back too.
In our Cabinet, Damien O'Connor used to run a tourism business on the West Coast, and David Parker had his own commercial law practice in Otago. Don't overlook the Maori economy either. Here in Hawke's Bay, Meka Whaitiri used to be the CEO of the Ngati Kahungunu Incorporation – iwi businesses are multi-million dollar operations.
We also have a $1 billion budget for economic development in the regions. That's a dramatic statement of our business credentials in its own right.
We remain well connected, and every week any MP worth his or her salt is getting around their electorate talking to small business owners and taking the pulse of their local economy.
I am always inspired by the innovative small business owners I meet in the Bay, who are taking risks with startups, often with help from Mum & Dad. They keep me grounded and I learn great new business stories.

How important to the national economy is the small business sector?
They are the backbone of the economy. They amount to around 500,000 companies, which represents 97 per cent of New Zealand businesses. They employ around 40 per cent of the workforce and contribute 28 per cent of GDP.
They provide the jobs that keep New Zealand growing. Most businesses in the provinces are small. They play a crucial role here in Hawke's Bay.
It might come as a surprise to learn that there has not been, till now, a Small Business Strategy that joins up all the work for this sector across the wider government. There are some great initiatives coming out of the science world for example, and in Maori development and regional development.
I have identified this as a gap we can easily and quickly do something about and I have already asked officials at MBIE to get the ball rolling on our new strategy.