Category Archives: Business

Updates and articles on my involvement in business events.

What is an Indigenous Business? The Many Definitions Are Confusing

Indigenous Business 50% or 51%
Indigenous Business 50% or 51%

So one would think that there would be a standard definition of what is an Indigenous business. Well unfortunately there is no single definition in Australia that is legislated as to what defines an Indigenous business. This creates much confusion for those wanting to seek out an Indigenous business as a supplier or to meet their contractual requirements such as under the Indigenous Opportunity Policy (IOP).

So before we go any further lets first clarify the definition of an ‘Indigenous’ person. Australia considers an Indigenous Australian to be someone who is

So what defines an Aboriginal or Torres Strait Islander person? We will use the Australian Bureau of Statistics definition adopted from Australian legislation. I have highlighted the key words

  • a person of Aboriginal or Torres Strait Islander descent,
  • who identifies as being of Aboriginal or Torres Strait Islander origin and
  • who is accepted as such by the community with which the person associates”.

So lets begin with the first definition that was around with Indigenous Business Australia (IBA). IBA has the following criteria for a business to be identified as being an Indigenous business.

  • at least one applicant must be of Aboriginal and/or Torres Strait Islander descent
  • at least 50 per cent of the ownership of your business must be by a person(s) of Aboriginal and/or Torres Strait Islander descent.

Okay, so IBA, a Federal Government agency, uses the definition that an Indigenous business is at least 50% owned.

We now go to Supply Nation, who provides ‘certification’ for being an Indigenous business. There definition is as follows to be a certified supplier or Indigenous business

  • Ownership – at least 51 per cent ownership of the company by an Indigenous Australian(s).
  • Management – the company is led / managed by a Principal Executive Officer who is an Indigenous Australian.
  • Control – the key business decisions regarding the company’s finances, operations, personnel and strategy are made by an Indigenous Australian(s).
  • For profit – the company is able to distribute its equity to members.
  • *Trading as a business – with a minimum annual revenue of $50,000.00 and a demonstrated recent history of trade (ideally, at least 6 months trade history).
    *If your business has low turnover (less than $50k) or is a start up (no trade history), then please refer to the Emerging Supplier section.
  • Business is located in Australia

So Supply Nation uses the definition as being at least 51% owned. This is important to know as Supply Nation (formerly known as Australian Indigenous Minority Suppliers Council (AIMSC)) is listed in the Indigenous Opportunity Policy as a reference point for Indigenous business.

So who else has a definition? Well the Queensland Government has its Black Business Finder (BBF) which is used by the Industry Capability Network (ICN) for contractors to source Indigenous businesses for major contracts. Note, that in order to be eligible to tender and work on these major projects, you have to be registered with ICN. So, Indigenous businesses are required to be listed for identification on the BBF. So BBF has for its definition

“Businesses defined as an Indigenous business are:

  • a majority-owned Indigenous business.
  • a 50% owned Indigenous business.

A non-Indigenous business that employees at least 75% of Aboriginal or Torres Strait Islander workers is eligible to register on Black Business Finder.”

Confused yet?! The Black Business Finder, which is required to be used by major contractors to source Indigenous businesses includes in its listings businesses that have 75% Aboriginal and or Torres Strait Islander workers. Do we need to go further as to what the definition of “75% workers” is? Does it mean 75% of the workforce? 75% of total wages? 75% wages/workers for the year? 75% of the wages/workers for the project life? This begins to create more questions then it answers. It is especially confusing for a company contractually bound by the IOP to source Indigenous businesses and they are required to use this register, yet they are not assured by the register the business meets the IOP requirements.

So are only government organisations limited to having different definitions? The short answer is no!
At the time of writing I am unable to find the membership application for Aboriginal Enterprise in Mining, Energy and Exploration (AEMEE) to locate their definition. But their historic position on being an Indigenous business was that if you say you are an Indigenous business, then you are accepted to be so.

Pilbarra Aboriginal Contractors Association (PACA) in their Review of Contractual Arrangements Between Australian Aboriginal Enterprises and the Resource Industry (2010) identified 25% ownership as their definition of being an Indigenous business.

In conclusion, there needs to be a single legislated definition of an Indigenous business. I sympathise with those organisations that are seeking Indigenous businesses but have to battle with this definition. In my opinion in a professional capacity, I see the definition of 50% Indigenous owned as being the best step forward. I see this as the opportunity for Indigenous business to grow through 50/50 joint ventures or partnerships. Think of the number of husband and wife partnership businesses where one is non Indigenous. Once there is an adequate and stable supply of Indigenous business that meet the requirements of capability and capacity to service corporate and government procurement, then there can be a transition to the 51% definition.

The employment percentage, to me, does not stand as an adequate definition as this is subjective and can be easily manipulated. If we used the definition of whether a company in Australia was an Australian business using the employee as a definition, then the majority of companies owned by overseas owners would be classified as being Australian owned because they employ Australian workers. Ownership is shareholding, not employment.

Please note I use organisations and their definitions as examples of where there is no consistency in defining an Indigenous business. At the time of writing, I myself am a member and Director of the South East Queensland Indigenous Chamber of Commerce (SEQICC) that uses the Supply Nation definition of 51%, but also a member and President of the Indigenous Construction Group Australia (ICGA) that uses the Indigenous Business Australia definition of 50%. When I am asked what is the definition of an Indigenous business, what would be my answer?

*UPDATE: On the 31st July 2014 the “Forrest Review” by Andrew ‘Twiggy’ Forrest on Indigenous Employment and Training was made public. As part of this, the review identified the significance of Indigenous business in contributing to employment outcomes and economic development. As part of the recommendation, the review gave the following part of its criteria for an Indigenous business for the purposes of being eligible for tax free status as being ‘…. At least 25% Indigenous ownership and board membership….’.

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Brisbane Lord Mayors Economic Development Business Forum- Rapid Business Growth

The night was one of two excellent speakers. Both young at age 36. I also invited along with me a young entrepreneur in the making. Dean is 25 and wanting to learn about business. I am glad I invited him to attend this particular forum.

Ian Davies, Managing Director and CEO of Senex Energy gave an excellent presentation of how he took a public company with $20m turnover in 2010 to become a $200m turnover business in 2014. All of this from a man who is only 36 years old. Ian noted the struggles his company faced as an energy explorer, from a flood wiping out roads and bridges and having to build new ones. To then be hit by another flood that wiped out that road and having to build another one higher. Some of the key points I took away from Ian’s presentation

  • Systems and Procedures– Ian noted that once you start to grow a business, the importance of systems and procedures becomes even greater to ensure the business is running course. Growth means more people, increasing the need to manage them more efficiently and keep them on course with a given framework of how the business is to operate.
  • Mentors– Ian as a young MD and CEO was targeted early by his now mentor to take on his current position. He quickly had to learn about all facets of the business. Ian stated that he is not a geologist, but he can talk with the best of them from his having to understand the core business of exploration. He did this by finding mentors whose knowledge and experience he could draw upon.

Anthony Yap, Managing Director of Good Price Pharmacy gave an inspiring presentation. From the time he left university aged 21 Anthony had one ambition, to own his own pharmacy. He started as a manager at a pharmacy working tirelessly to learn about how they ran their business. In one year he had purchased his first pharmacy. That quickly began to grow in numbers where the second pharmacy he bought for $270k he sold one year later for $1.2m. Anthony also told of his fight against a major competitor who setup a discount pharmacy only doors down from his own. At a meeting with his competitor, they told him they had the budget to drive him out of business. Anthony stood his ground to now run 44 stores. Some of the key points I took away from Anthony’s presentation

  • Systems and Procedures– This was the first thing Anthony learnt about while managing a pharmacy. He wanted to know every process that was involved in running a pharmacy so he could implement them into his own. This is how he could buy a business for $270k and sell it one year later for $1.2m.
  • Passion and Persistence– You need to be hungry for business to drive you to work at it. Anthony was asked “How do you know if you have a passion for business?” his response was “If you have to ask yourself that question then you don’t have the passion”. Persistence is what got him his first store and allowed him to endure the ordeals of his competitors.
  • Directors and Shareholders Agreements– As one of 4 partners initially, Anthony went through the ordeal of buying out his partners where there was no partnership agreement in place setting out the agreed buy out/exit procedure for a partner. This cost both time and money, taking a toll on the business.

 

Unique Selling Proposition (USP)- Why Am I Going To Use You Instead Of Your Competitor?

USP POD WIIFM
How your POD will influence your USP for your customers WIIFM- http://www.damienfoley.wordpress.com

So you have a great business selling widgets. Now you are about to go and market your business to bring in clients. But why are people going to buy your widgets over your other competitors widgets?

This is where you need to be clear on what your unique selling proposition/point (USP) is. A USP is what makes you different from your competitors. This consists of your point of difference (POD). To do this you really need to know the product you are selling and how it meets your customers need, want or desire. This may mean you need to reassess what your actual product is. It could mean you need to refine your product. For example, you may be an accountant. But you may need to specialise in tax advice to Doctors. Or you may need to expand your product. For example, you may need to not only provide a web design business, but also provide graphic design, copy writing, SEO, Database design etc.

WIIFM

WIIFM- Whats In It For Me. This is what you are trying to answer in your USP to your customer. How are you going to solve their problem? Do they even know they have a problem? As part of your marketing, such as your elevator pitch, you may actually need to identify the problem your customers might have and how you solve it. For business, typically the WIIFM is “how are you going to add value to their business?” For customers, it is generally “how are you going to make them feel?”

Price

Now you might say “Well my widgets are cheaper”.

Well, if I buy a widget once a year and your widget is $1 and your competitor is $1.20, do I really care, for the sake of twenty cents, that you are cheaper? No.

What if your widget is $1,000 and your competitor is  $1,200? Yes, for $200 I might want to buy your widget. But what if it takes you one week to deliver my widget and your competitor delivers overnight? If I need the widget for my business that costs me $1,000 every day I don’t have the widget, is being $200 cheaper important? No.

Price alone isn’t always a unique selling proposition.

Technical Jargon

A big problem many business owners have when they explain their USP, is they use technical jargon. Remember- WIIFM above and KISS- Keep It Simple Stupid. I don’t care if your widget is made of high tensile polycarbonate. I don’t know what that is. But if you tell me it will last 5 times as long as an ordinary widget which will save my business money in down time for maintenance, or saves me time by only having to replace it once a year instead of every 2 months, now I know what you are saying!

Examples of POD’s for your USP’s

Remember, you need to provide a strong enough reason for someone to purchase your product over a competitors. List your POD’s from strongest to weakest.

  • Value- Reduce costs, increases revenue; adds value.
  • Emotions- Sell the emotion. Makes them feel good/happy; reduces stress; removes fears or concerns; people we love/care for such as family; creates attention/importance; feeling of acceptance/part of a group/ smart/  etc.
  • Time- delivery time; down time; response time; productivity; impulse buy; availability etc.
  • Quality- improved performance; reduced repeat maintenance; reduced down time; warranty or guarantee; assurance etc.
  • Legislation- meets or exceeds compliance standards; improves safety; enhances compliance or reduces legal risk; etc.
  • Social Responsibility- Community benefits; worthy cause; gives to others- school children; homeless; less fortunate; third world people; those affected by natural disasters; etc.
  • Environmental- environmentally friendly; green energy; carbon neutral; recycled/recyclable; reduces or eliminates environmental problem; etc
  • Status- Latest model; exclusivity; price etc. This is a part of emotions.
  • Add Ons- secondary features as a cars digital radio with blue tooth connectivity; Smart Phone with built in camera; bonus or discounted products as free delivery or a second one half price.

USP Examples

Different customers are going to have different needs- WIIFM, meaning you will need to identify the USP that applies to them.

IT Consultant- “We back up your files every 2 hours on local cloud servers offsite. Meaning if your computer files become corrupt, we can restore all your files within 4 hours, reducing your down time which makes you money.”

Green Grocer- “We support local farmers by buying local organic produce. This also reduces our carbon footprint from paddock to plate. Meaning you’re supporting local farmers and your family are eating healthy fresh fruit and vegetables.”

Accountant- “We specialise in medical professionals, meaning we provide you the best tax advice as a Doctor. This assures you pay only as much tax as you have to and minimises the risk of an audit.”

Cafe- “By using our app, you can order your coffee even before reaching our shop, saving time queing in line. By using our Coffee On The Go app, you also earn reward points towards your free coffee. You will also feel good knowing the coffee you’re drinking is made from coffee beans certified by the World Amnesty Against Child Labour.”

~ Damien Foley

How To Create Your “What Do You Do?” Elevator Pitch

So what is an Elevator Pitch? Well, an Elevator Pitch is essentially your response to the age old question asked of “What do you do?” An Elevator Pitch should answer this question in a few sentences in less than a minute or two with the purpose of 1. Informing them about what you do exactly; 2. Wanting them to know more; 3. Getting potential sales leads or follow ups.

There are three different Elevator Pitches I am going to introduce you to. All of them are very simple. From these, with practice, you can then develop your own unique elevator pitch. Remember that as part of your elevator pitch, you should be introducing your Unique Selling Proposition (USP), to differentiate your business from your competitors.

Slogan or Tag Line Pitch

Geddes/Getty Pitch

Why- How- What Pitch

Mix and Match Pitch

Remember- Practice Makes Perfect

Try each of your pitches as much as possible. Use as many networking events as possible to practice each of your pitches to see what works and what doesn’t. Don’t be afraid to experiment and change your pitch. Identify what catches the interest of people and what doesn’t. What makes them want to know more? Soon, you will have your elevator pitch down and it will confidently roll off your tongue as second nature when you are asked “What do you do?”

~ Damien Foley

Meet Up Brisbane Business Owners and Entrepreneurs Networking Event- 5th March 2014

namebadge
Personal name badge- My essential networking tool!

I attended this event last night, sponsored by Servcorp at their Riparian Plaza, 71 Eagle St Brisbane QLD serviced offices. There wasn’t a big turn out with about 20 people attending. But I did meet some interesting business owners.

Glenn from Computer Troubleshooters- Windsor told me about his franchise that he just started 3 weeks ago. Glenn is already in conversation with major players in the industry such as Microsoft and AVG. He is wanting to specialise in servicing the accounting industry. He also is a big fan of the Rich Dad Poor Dad books, something I can relate with!

Ben from Cyberbash is an Internet Service Provider (ISP). He also does other areas of IT, as we discussed with himself and Justin about my idea for a phone app. Interesting things are happening in the tech sector for Brisbane, as I found out about a hackers spot. No, not hacker criminals but people who write computer code as a living.

Jody from Aussie Financial Services does insurance for business. I was talking to him about Foley Business Management where we provide services to the Not For Profit (NFP) sector. Jody is going to forward to me a contact he has for someone who provides audits for NFP’s at a reasonable price, as he is the Treasurer of a motocross club.

Not being a big night I did meet some new business owners and arriving at 6:30pm I was out of there by 8pm.

if you want to find out where I will be or what other events are on, go to my Where I Will Be page.

10 Things You Need To Do Before You Network

namebadge
Name Badge

Networking is a lot of fun, but it does involve some preparation. Here is a general run through of my routine

1. Identify where you are going to network- We have already covered How to Find The Right Networking Event For You in my previous post.

2. Business Cards- always have business cards with you when attending. There are exceptions to this rule. I will go into more detail about what your business card should have in a future post.

3. Elevator Pitch– An elevator pitch is a quick spiel that in a few seconds tells people what you do. I will go into more detail about what types of elevator pitches there are and how you can create one for yourself.

4. Name Tag- I personally have my own name tag I take to events- I have several in fact for the different organisations I may represent! These are incredibly important as they allow people you have never met to automatically know who you are and who you represent. It helps to break the ice of meeting someone new if they already know who you are before they meet you.

5. Dress to Impress- You only get one chance at a first impression! How you present yourself is the first impression people will have of you. Dress to suit the event. Again, I will go into more detail about how to dress and present yourself for your event in a later post.

6. Cleanliness and odour- you might think this is a no brainer, but everyone is different. What is acceptable to one person is not necessarily acceptable to another. We will discuss this in a future post. But remember you are trying to connect with others and how others perceive you from how you present yourself could damage your personal brand (we will discuss personal brand later also).

7. Eating- I generally try to eat before I go to a networking event. Many networking events serve finger foods such as dim sims, small sandwiches, mini spring rolls, mini quiches etc with dipping sauces. This is eaten standing up while networking. Your only source of cleaning is a napkin! Eat before you go so you’re not talking with a mouth full of food; shaking hands and handling business cards with oily fingers; and spilling sweet chilli sauce over yourself and others; hunger pains from lack of food- all while holding a drink and other documents.

8. Drinking-I have a general rule that I don’t drink alcohol at work events. One is to do with the smell of beer on your breathe. The other is at some events, you may have one too many and be the person that does something stupid everyone will remember (personal brand!). Also, avoid glasses filled with ice unless sipping through a straw. A glass with ice can be embarrassing if it makes the drink spill on you when you’re about to take a sip.

9. Logistics- Work out how you are getting there and how long it will take. Will you be paying for parking? What time does public transport run? How far do you have to walk and is it up hill? Knowing in advance could save you problems later. Don’t forget your return trip also!

10. Public Speaking and Practice- I say public speaking as you are likely to be meeting people on a ‘cold call’ basis. Some people dread talking to people they don’t know. Don’t give up if you don’t feel you did well your first time or you got butterflies in your stomach when talking to people. Learning how to network comes with practice. Your spiel, your approach, timing, when to be serious or to be funny, how to read people. We will go over this more in a later post.

I hope this helps you prepare for your next networking event. We will discuss the above items in another post.

~ Damien Foley

How To Find The Right Networking Event For You

So you want to meet new people to network with. But where are they? And which is the right one for you?

Ideally, ask someone you know who is already networking to give you some ideas on where to network. Meet Up, for example, is an online place to find where people are meeting for different interest groups in a particular area. I strongly recommend this if you are new to anything, anywhere!

Below are some different organisations and types of ways to network.

Speed Networking | Chamber of Commerce | Business Networking Inc | Sporting Clubs | Exclusive Clubs | Industry Events | Meet Up | Art Exhibitions | School Events | Community Events and Organisations | Private or Exclusive Events | Online Forums and Communities | Social Media Linked In- Twitter- Facebook | Volunteering | Lions Club | Quota | Rotary | Seminars and Workshops | Book Clubs | Cooking Classes.

Remember, networking means different things to different people. Ask yourself the following questions

1. Who am I wanting to meet/what is my purpose? Business or pleasure? Are you wanting to meet new clients; new suppliers; new friends; colleagues from your industry; mentors; new business partners; investors; employees; people who are in a particular industry or have common interests? Don’t always assume that for business you need to go to events where only your potential clients are.

2. How many networking events do you want to attend each week or month or year? How frequently do you want to attend any one networking event? I can literally go to a networking event every day for almost every day of the year. But I wouldn’t get much work done if I did!

3. What are my limitations? Cost? Travel time/distance/location? Time to attend? Time to contribute to the organisation? Some networking events cost money to attend, not including the additional costs of meals, drinks, contributions etc. Where the event is and the time commitment to attend is also a factor. Some networking events are not just networking but also part of an organisations official meeting.

Networking is about meeting people. Don’t immediately dismiss an event because those attending are not the people you want to meet. Getting to know these people and making them a part of your network might open you to other people who you are wanting to meet.

If you want to find me, I have my “Where I Will Be” page letting people know what events I am attending for business. I also link a little blog I do on the event as well.

Personally, I use Meet Up to meet new people once a week for both the personal and professional interaction. I have made this part of my goals for 2014.

So now you can find events to network at. But what do you need to do to start networking? Find out in my next post!

~ Damien Foley