Cutting the business failure rate
A group of the country's most successful entrepreneurs are stepping in to help small business owners who often lack the practical skills needed to run a successful enterprise.
New Zealand has 460,000 small-to-medium enterprises (SMEs), which account for 97 per cent of all Kiwi businesses, according to the Ministry of Business, Innovation and Employment's 2014 Small Business Sector Report. However, enterprises with fewer than 20 employees have lower survival rates than larger firms, with roughly a quarter of them dying within three years from 2010.
The failure rate is not due to a shortage of creativity or ideas but often a lack of day-to-day business knowledge or a hesitancy to ask for help, according to a group of four well-known entrepreneurs.
Chef, restaurateur and author Al Brown, fashion designer Kate Sylvester, chief executive of Moa Brewing and chairman of Trilogy Group Geoff Ross, and ex-cricketer and Triumph & Disaster founder Dion Nash are fronting the 2degrees mentorship campaign, Building Better Business.
As part of the campaign the four businesspeople will conduct one-on-one mentoring sessions with eight selected Kiwi SMEs.
Brown said New Zealand business owners needed to surround themselves with people who excelled in the areas where they lacked.
"If you ask someone the right question you can learn so much."
And people liked being asked for help, Brown said.
"To be successful you have to learn to ask for help," Sylvester said.
Nash said business owners should always employ people smarter than themselves. Kiwi entrepreneurs were creative and emotionally intelligent but they needed to learn the fundamentals of good business.
SMEs should "begin with the end in mind" and set big goals, Nash said. "I don't think you can aim too high."
Ross said it was important for businesses to have financial capital as well as people capital in order to achieve their global growth ambitions. Historically, Kiwis had shied away from trading equity in the business for much-needed growth capital, he said.
SME owners also needed to fully commit to their business in order to be successful, Ross said. It was impossible to give the business everything while clinging to the security of a nine-to-five job. The leap of faith was worth it, he said.
"I wish I'd gone harder, faster, sooner."
2degrees head of marketing communications Trent Harnett said the four mentors reflected the 2degrees brand with their "entrepreneurial spirit".
"They are honest, straightforward, everyday New Zealanders who have been successful in their business."
SME owners had good business knowledge but they did not know all the mobile technology products and services available to help make their business more productive, Harnett said.
"You don't know what you don't know."
The mobile company, which launched in 2009, was focusing on the business market to give Kiwi companies a more competitive offering, he said. 2degrees had a successful start in the consumer space but it had always planned to move into the business market.
2degrees senior marcoms manager Rhona Clark said the chosen mentors had excelled in their individual industries, both in New Zealand and on the world stage.
Volunteer business mentoring service Business Mentors New Zealand would accompany the mentors to offer personalised, tactical advice, tools and solutions.
Business Mentors New Zealand chief executive Ray Schofield said although SMEs had the ideas, work-ethic and drive, many lacked practical advice and experience from a business mentor.
"Sharing expertise and problem solving is imperative to a successful business."
WIN BUSINESS MENTORING
Entries for small businesses to take part in Building Smarter Business open tomorrow. For more information and a chance to win a mentoring session head to stuff.co.nz/2degreescompetition
Sunday Star Times