At only 26, New Zealand entrepreneur Carl Bates believes he knows where Australian small business owners are going wrong, and he’s not afraid to tell them.
As the managing director of a global company and a self-made multi-millionaire, Carl hopes to teach Aussies a thing or two about business strategy when he flies into the Gold Coast for the first ever Australian Sirdar Business Summit on November 12-14.
Carl says too often small business owners use excuses to defend a lack of cash flow and high levels of debt. He says business owners need to step up and take responsibility for their cash flow issues if they hope to succeed.
“Cash flow is never a problem, it’s only ever a measure” he says. “It is a symptom of deeper problems in a business.”
“Revenue and margin are easily eroded by slow paying debtors, customers returning products and suppliers increasing prices, but it is unacceptable to blame a lack of cash flow as why you are not driving the business forward.”
He says business owners can take action to improve their business by looking at their terms of payment, their plans for investments, and their working capital, all of which often reveal deeper problems about the business. Carl says that even successful small businesses can hold themselves back from expansion by refusing to allow outside assistance for governance and management.
“After a certain point, you can’t do it all alone,” he says.
“Businesses become stagnant without formal accountability and challenge.” Indeed it is one of Carl’s first laws of achieving extreme business success. Carl strongly suggests that business owners look at distinguishing between the roles of shareholder, director and manager.
This is achieved by putting in place formal governance with directors responsible for the overall direction and decision making of the company. To help small businesses meet this challenge, three years ago in New Zealand Carl set up a company called Sirdar, to provide small business owners with ‘guns for hire’ in particular fields.
Unlike a business mentor, the Sirdar team actually join a business’s board, are involved in the day-to-day decision making process and are legally liable for decisions made.
Since inception, Sirdar has experienced extraordinary growth, branching out in Australia, South Africa and the UK and going from zero revenue to US$ 700,000 in six months and reaching US$ 5,700,000 by end July 2008.
Carl believes there are many steps small business owners can take to improve cash flow problems and expand, but the first step is to closely examine a business’s needs.
“Entrepreneurs are great at identifying a gap in the market and coming up with ideas to meet that need, but for a business to be successful you need more than just great ideas,” he says.
“Effective strategies, governance and direction are essential in order for small businesses to overcome their cash flow problems and move forward.”
Carl will share his expertise and tips for business success on the Gold Coast this month for the first ever Australian Sirdar Business Summit, from November 12-14 at Sea World Nara Resort.
To book, visit www.sirdargroup.com or phone Jaqueline Whyte on 0403 272 016.
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