Retail is one industry that has already provided a vast source of business opportunities and employment for Indigenous Australians, yet it still has the potential to empower countless others – closing the economic divide even further. At a time where reconciliation is high on the agenda, a number of questions need to be asked. To start with, what hinders Indigenous Australians from starting their own enterprise and what are the unique challenges they face? Then, with this in mind, what can be done to foster their participation in business?
The Koorie Business Network delivered its first Indigenous Economic Development Conference last year in partnership with Aboriginal Affairs Victoria. The event attracted Indigenous and non-Indigenous Australians, state government officials and international guests. The event not only celebrated the many Indigenous success stories, but it also focused on some of these challenges and what was being done to overcome them. In particular, discussions honed in on moving away from an era of welfare dependency to one that focused on economic independence. Here’s a brief run down of what was discussed.
The challenge of gaining access to finance and capital:
A major factor which impedes Indigenous Australians from establishing their own enterprise is their inability to access capital to start up or run their own business. The impediment to accessing capital can simply be due to a lack of business history, but in many cases, the issue is rooted in more fundamental social issues such as literacy and numeracy problems or not understanding the system and the processes required to access capital.
Without these absolute basics, there is a high risk of financial mismanagement. Financial mismanagement inevitably leads to bad debt which then further deters lending institutions from providing capital. Conference delegates generally agreed that some financial institutions simply mistrust Indigenous culture because they don’t fully understand it. This mistrust blocks aspiring Indigenous entrepreneurs from starting their business and reinforces the divide between Indigenous and non-Indigenous Australians perpetuating a spiral of further mistrust.
In more recent times, an increasing number of mainstream business programs have evolved offering participants start up capital provided they fulfil various criteria, however many Indigenous Australians tend to shy away from these programs because of the lack of cultural sensitivity.
Traditionally, many Indigenous businesses such as galleries and tourism businesses have gained the assistance of grants and subsidies from philanthropic organisations to help them in the start up phase and some rely on ongoing funds to keep their business running.
As more businesses start up and more non profit organisations seek funds, there is less start up capital to go around. Finding alternative sources of revenue is becoming increasingly vital as more traditional sources of funding disappear.
One of the key problems identified with the current system is that the majority of government funding in Australia is directed towards social welfare rather than economic development and job creation.
In recent times, however, it appears that the focus has been shifting. There are now a number of programs that focus on economic empowerment such as the Outback Stores initiative, where subsidies and structure are given to remote outback stores so that they become more efficient and profitable. The aim of the Outback Stores initiative is to help businesses become self sufficient and provide remote communities with more affordable fresh and healthy foods.
Organisations such as Victoria’s Koorie Business Network also play a role in empowering Aboriginal Australians economically by providing support to those who want to start up their own business and gain economic independence. The network has a wide range of services including business support, professional development programs, workshops and grants which are supportive and culturally sensitive.
Succeeding in contemporary business:
Indigenous Australians place much weight on culture and traditions and one of the challenges they face is maintaining a balance between preserving the culture and the commercial realities of running a business.
Conference participants generally agreed that attaining a balance is achievable but in some industries such as art, tourism, Indigenous foods and entertainment – the emphasis on culture, which in their opinion should not be compromised – narrows the parameters economically.
In saying that, there are Indigenous businesses that have successfully achieved this balance such as Native Oz Cuisine. Native Oz Cuisine uses Indigenous produce to create ready to go gourmet meals and sauces.
The company – which is wholly owned by Indigenous Australians – markets its products to food retailers and grocery stores Australia-wide while at the same time ensures that all native ingredients harvested are replanted to promote both environmental and economic sustainability.
Such companies and other Indigenous business champions who showcase what can be achieved play a major role in demonstrating to others how these problems can be overcome and what can be accomplished. Business networks and organisations that specifically cater to Indigenous Australians serve as a channel between these role models and those who aspire to succeed in business. Historically, organisations run by Indigenous Australians for Indigenous Australians have been the most successful support structures because the people working in these networks understand the realities of being Indigenous and in business first hand.
The Koorie Business Network, for example, places much emphasis on nurturing good business acumen and developing confidence among its participants in a culturally-sensitive environment.
Because Indigenous businesses don’t operate in a vacuum, much emphasis has also been placed on non-Indigenous partners in assisting business development. There have been cases of great success when the partnerships are based on respect, relevance and the right cultural fit.
Education is the key:
Despite an increasing number of Indigenous people going into business, education levels are still well below that of non-Indigenous Australians.
Without literacy and numeracy skills, success in running a contemporary business is next to insurmountable.
Conference delegates acknowledge that there is a need to maintain and improve educational levels so that Aboriginal Australians have the fundamental knowledge frameworks to successfully operate their own business. Skills development opens many doors to those who want to establish their own business and equips them to participate equally in a highly competitive environment.
A great example that applies to retail is when the ARA in conjunction with a number of other RTOs delivered the Employment Pathways program to Shepparton – training a group of young Koories to Certificate II level in Retail Operations. The course covered a wide range of topics ranging from stock control through to merchandising and customer service ensuring the participants had the skills required to work in a competitive retail environment.
The students who participated in the course went on to secure full time employment in retail where they can then further develop their skills, equipping them with the tools to establish their own business in the future.
To the future – stereotypes versus reality:
Current research reveals that Indigenous businesses are still perceived as community based, outback organisations whereas in reality there are an increasing number of urban Aboriginal entrepreneurs who have highly successful businesses.
The impact of these businesses is yet to be determined but it is believed that this will become more apparent over the next 30 to 40 years as the number of Indigenous people in business multiplies.
To ensure that Indigenous businesses proliferate and the shift from welfare dependency to economic empowerment occurs, it is agreed that support organisations such as the Koorie Business Network or Indigenous Business Australia will be integral to their sustainability.
