THINK TANK - Nett's small business discussion series. Pt1: Rip the red tape!

• Seamus Byrne, David Hutchins, Marguerite McKinnon, Stuart Ridley
• 13 November 2007
• Page 1 of 2 : single page

L-R: David Hutchins, Stuart Ridley, Marguerite McKinnon, Seamus Byrne. Photo credit: Anthony Geernaert

The panel:

David Hutchins Business writer, Press Matters

Marguerite McKinnon Channel Seven Journalist

Seamus Byrne Technology journalist, Gizmodo

Host: Stuart Ridley Content director, Nett

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Topic 1: Advice from Government

Stuart: Thinking back all those years to when you set up your business, David, what were some of the online government resources you wish you’d had access to?

David: We’ve always, theoretically, had access to government agencies such as the NSW Department of State and Regional Development, but now they all have big websites it’s easier.

The Federal Government’s business.gov.au portal has numerous documents and checklists for businesses to help them do things right, get online, and ensure they guard themselves against scams.

You can also get downloads on compliance from everyone, from the Tax Department to the Department of Fair Trading.

Marguerite: Apparently more than 100,000 small businesses accessed business.gov.au in the past 12 months: that’s a fair number, but a pittance of the more than 1.89 million small businesses in Australia.

Is it a question of small business people not knowing about these resources? Or do they want something else?

There are now approximately 70 Government small business field-officers around Australia, which means businesses can speak with a person when they need help. Business-owners can call Aus Industry on 132 846 for more info.

Seamus: Small-to-medium enterprises (SMEs) have a common problem with lack of time. While many of these government sites are worthwhile, it can be difficult to get the small piece of information you actually want.

Topic 2: Tax, red tape and other hassles

David: Tax obligations and red tape are big issues even for larger companies with teams of accountants and finance departments.

As you go down the chain into the smaller businesses, these issues become bigger pains in the neck because of the time burdens of getting them right. On the other hand, governments are working on improving their actions to help SMEs.

Funnily enough, I learnt recently one of the state governments launched a $98 million program ‘supporting the changing face of small business,’ and $42 million of that was for cutting red tape!

Stuart: Hmm… What are some of the things we can do to work through these issues?

David: How many of us have spent time – or asked one of our team to spend time – on a 1300 government number to sort out a tax or legislation issue?

As small business owners we may have to learn to trust, and get over the issues about handing our books across to someone else.

Why would you go through the labyrinth of tax and bureaucracy when you can pay an accountant or adviser a relatively minor amount to do it in much less time? Capitalise on your strengths.

If your strength isn’t accounting, isn’t tax or isn’t dealing with bureaucracy, then you might have to think about outsourcing those functions. You can then spend more time with your customers and develop your stronger points in service: every touch-point with a customer should become an area of your strength.

Topic 3: Innovation

Stuart: While we’re more flexible and can move faster than big businesses, big ideas need money to take off…

Marguerite: There used to be a taxation regime for R&D (research and development), which was a 150% tax rebate, but that evaporated. The innovation question is strange.

We like to promote ourselves as a clever country, yet governments cut tertiary education funding and substantial research, tax us severely and hinder us with bureaucracy that doesn’t aid innovation.

David: There are departments such as Austrade and State and Federal authorities. The challenge is understanding what grants are available.

Seamus: We talk about overnight success, but there’s no such thing as overnight success.

Those ‘overnight successes’ have taken months, years and decades in garages burning the midnight oil because they haven’t got the money to get the concept to commercialisation.

The banks might lend the money just give them your house! Why wouldn’t you accept millions of dollars from a big company?

Marguerite: Joining big business creates a risk of the small business being undercut and pushed out of the market. The amendments to the Trade Practices Act of 1974 were introduced to try and stop bigger competitors from engaging in below-cost pricing to damage their competitors.

David: The big guys have the Prime Minister’s ear and the clout to introduce all sorts of measures to improve business. Ideally this Federal Government will be energised into building bridges between the various camps of small business, big business and government.

Seamus: The savvy people aren’t just relying on government, they are out there scrimping and networking and doing the whole thing.

Topic 4: Networking tips

Stuart: Speaking of networking, Seamus, I know you spend a fair amount of time professionally and personally on blogs and forums as well as social networking sites such as Facebook. What are some of the things you’ve learnt that we could apply to small business websites?

Seamus: Certainly when you encourage your readers or customers to communicate with you regularly you can develop a sense of community. Then they’re not just customers that simply visit. Encouraging networking helps turn them into return visitors and it gets them more involved. Try to reward them.

Marguerite: Australian small businesses highly rate being treated as an important customer. A recent survey commissioned by American Express worldwide also found Australian small businesses are more optimistic than their counterparts in most of the rest of the world. We’re also far more likely to use online tools including feedback and redeeming rewards.

Topic 5: Workers’ choices…

David: Times have changed since the days when kids got apprenticeships. I would wager that trend has fallen significantly over the years.

The skills shortage has been evident for several years now and the Federal Government has provided incentives for more people to do apprenticeships, including mature-aged people. It depends what business you’re in: if you’re a farmer and you have fruit-pickers coming in, you might say, this is only for a couple of months, I’ll pay them this, and it’s pretty much a done deal.