Small business challenges: from the horse’s mouth

Small business challenges: from the horse’s mouth

There’s plenty of research out there analysing the drivers for small business, but not a lot that includes insights from small business operators themselves.

A new study of 40 owner-operators of small businesses in the Hamilton area by researchers at the University of Waikato aims to fill that gap.

Finance Masters student Ben Flay spent the summer visiting small businesses in Hamilton, Cambridge, Te Awamutu and Whatawhata to gather information on the challenges facing SMEs from the horse’s mouth: the managers themselves.

The interviews focussed on their goals and aspirations in setting up the business, challenges they face, coping strategies, where they turn for support, and the successes they are most proud of.

“One of the big trends we found was that typically people underestimated the differences between working for someone else and running your own business,” says Flay, who won a Summer Research Scholarship to embark on the project with Dr Helen Samujh and Dr Linda Twiname of Waikato Management School.

“A physio, panel beater or plumber might decide to go into business on their own and find that their role has changed significantly as a consequence. You may be great at what you do, but running a business may be entirely different. Dealing with staff and people was also a big issue.”

Flay also found that many owners-operators had set up their own businesses to achieve a better lifestyle, work flexibility and more independence. “But what they typically found is that they ended up working long hours and couldn’t step away from the business.”

For support, a lot of those he surveyed turned to friends and family. Business coaches and mentors got a big thumbs up from business owners. “Almost everyone who used them said they were brilliant,” says Flay. “And a lot of people raved about Opportunity Hamilton which seems to be a great way for people to get the business basics with training in marketing and record keeping.”

Flay found the whole survey process fascinating. “I’ve learnt a lot more than I thought I would,” he says. “Previously I’ve spent the summers working in accountancy firms, but this looked an interesting project. Getting out and talking to so many different people about their business taught me stuff you can’t learn in class. Small business is so varied, everyone has completely different challenges and goals, so it’s very hard to find a one-size-fits-all solution.”

The researchers are now analysing their data and plan to publish their findings to highlight what help small businesses need and want. They will also produce a paper looking at what effect changes in the ACC business environment has had on small physiotherapy businesses.

Flay finishes his Masters degree in July, and is already job hunting. “I’m aiming to go into a finance, banking or accounting environment. Thanks to the Summer Research Scholarship, I’m so much better equipped to deal with small businesses than I would have been six months ago.”

The University of Waikato Summer Research Scholarships are available annually for promising undergraduate, honours and first year masters students. They are for ten weeks and come with a $5,000 stipend for the student and provide supervisors with an extra pair of hands for their research projects.

ENDS

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