Businesses need to help themselves

MARIA SLADE
Last updated 05:00 21/02/2014

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OPINION: Mike Murphy is making cold coffee.

This is not something found at the bottom of an abandoned cup but rather a trendy new beverage on the New Zealand coffee scene. Sometimes served on ice or even in a cocktail, it allows caffeine addicts to support their habit in comfort on sticky summer days.

Murphy's Auckland roastery, Kokako, claims to be the first in this country to concoct the brew, and it did so with the help of The Foodbowl, an open access facility where food companies can do trial runs of new commercial products.

The lab is funded two-thirds by the Government's advanced technology institute Callaghan Innovation, and a third by Auckland's economic development agency ATEED.

Kokako is currently producing 1000 bottles of Cold Brew a week for domestic consumption, but has export aspirations and will be heading back to The Foodbowl at summer's end.

The business has seen its share of economic tough times since Murphy bought it in May 2007. He's made mistakes, he says, and fixed them. Now Kokako is in a growth phase again and employing 21 people.

Murphy stands by the old adage that God (or indeed the Government) helps those who help themselves. He's a great networker and reader of newsletters, and believes business owners have a responsibility to seek out information and assistance.

The number of Kiwi enterprises has been shrinking since its peak of 480,000 four years ago. At last official count there were 472,600 legal entities, including companies, partnerships, trusts, self-employed people and voluntary organisations.

The Census tally of employers reveals the same trend. In 2013 there were 129,000 employers, down significantly from 142,900 in 2006.

The upside is that both sets of figures show the number of employees has risen - ergo, remaining businesses are employing more people.

Nevertheless the numbers have Greens small business spokesman David Clendon worried. Regular readers of this column will know I generally have no patience with anything the Green Party has to say on the economy, but the eminently sensible Clendon is in a category of his own.

He is concerned that the drop in employers indicates a rank-and-file SME sector not exactly jumping for joy over the economic recovery. Many of those who survived are only now emerging from their bunkers following the protracted downturn, and any new growth will be off a low base.

Assistance for these firms is not as readily available as it once was, with government help targeted at rising stars and export-oriented ventures, Clendon says. He fears the effect on grassroots Kiwi enterprise, particularly in the regions.

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Tenby Powell, who set up the sector group SME Business Network, does not share this view. There are any number of good government resources available to firms of all types, and there does need to a focus on scaling up, he asserts.

Where he is critical is in the communication of these programmes. He can understand a government not wanting to market such services for fear of a stampede, but there's a fine line between marketing and effectively communicating what's out there.

No-one would deny that running a business day-to-day while simultaneously coming up with and executing growth opportunities makes a Cirque du Soleil performance look easy.

But in 2014, business owners need to know that they cannot operate in isolation. A survey out this week from the External Reporting Board is telling - almost two-thirds of SMEs have no idea that new financial reporting standards are coming in on April 1, this despite the fact the changes could save them time, trouble and money.

In these days of social media, email newsletters and a seemingly endless round of conferences, industry groups and networking events it shouldn't be that hard.

* Maria Slade is editor of Unlimited magazine. maria.slade@fairfaxmedia.co.nz

- Fairfax Media

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