CEO of Banjo Loans, Guy Callaghan gives his thoughts on why diversity in the workplace improves productivity and bottom line.
Small businesses in Australia are increasingly being led by women. In our experience as a lender, women’s approach to running an enterprise can sometimes give them the edge over their male counterparts.
Women are still under-represented in the leadership of ASX 200 and other large businesses in Australia – a recent article in the AFR stated that women account for just over a third of all managers in major Australian companies. This figure that has barely changed in the last 12 months. However, the picture in SMEs (small to medium enterprises) is very different.
According to the Xero Boss Insights 2020 report, the growth in the number of Australian businesses led by women is outpacing the growth in those led by men. In 2019, there were 1.4 million male business owners, up from 1 million in 1991, which is an increase of 40 per cent. However, the number of female-led businesses grew by 80 per cent in the same period, up from 420,000 to 800,000.
The same Xero report states that women have taken the lead over men in founding businesses in the healthcare, and education and training sectors. It suggests the pace at which the business ownership gap is being closed is likely to speed up during the 2020s, as more tertiary-educated young women develop their careers and approach the peak age for being their own boss at 45.
According to outgoing Small Business Ombudsman Kate Carnell, research has shown that for many women, starting a business provides the flexibility to work from home, opportunity to pursue a passion, and the ability to better juggle work and family commitments.
As a lender, I can confirm that one of the defining characteristics we’ve noticed among our women clients is that they don’t appear to be as reluctant to ask the question everybody else is afraid to ask. It is often the answer to that question that leads to business improvement and efficiency gains. Or alternatively pivoting the business model to operate better.
An example of this is Banjo client, Fiona Horman, founder and managing director of Regency Media Pty Ltd. Under Fiona’s stewardship, Regency Media has expanded over its 35 years in business to become a diversified group comprising digital media manufacturing and distribution, licensing and publishing.
Its customers have included the world’s largest film studios and music businesses including Twentieth Century Fox, Sony, Disney, MGM, Icon, Madman, EMI and Mushroom Records.
Its licensing division Shock Entertainment sells physical entertainment product through JB Hi-Fi, Big W and Sanity. Regency’s publishing division Five Mile focuses on children’s books and publishes brands such as The Wiggles, Trace Moroney, ABC for Kids, Thomas the Tank Engine and Miffy.
By offering a full supply chain solution – manufacturing, warehousing, distribution and licensing – Regency has established a sustainable advantage over its competitors.
Fiona has this advice for women founding or running their own business. “Irrespective of your gender, it is important to be resilient. Always be prepared for the unexpected, it happens to everyone. Don’t be afraid to ask for help and advice when you need it. To this end, it is extremely beneficial if you can find a good mentor to discuss all and any issues with.”
Another Banjo client Erica Hughes is owner and director of the health food business Slendier. This fast-expanding business began in 2013, with Erica purchasing the brand in 2017 with a strategy to grow the business in terms of geographic expansion, marketing and new product development.
Slendier focuses on all natural, plant-based, healthy and delicious food which is genuinely good for you. Having come from a corporate background, Erica was looking to make a change and gain happiness through a new career journey that involved her owning and setting the strategy for her own business. The Slendier business now sells in both supermarkets and online channels throughout Europe, the Middle East, South East Asia, China, Australia and New Zealand.
Erica says it’s tough for anyone to own a global business right now and you need to back yourself with every decision. Erica’s advice for other female entrepreneurs is to “be confident, boldly step over each roadblock, seek out mentors and others who inspire you and also take time to look after yourselves”.
Another perspective comes from Sonja Pfitz of Pfitz Financial & Business Solutions, a commercial finance broker for SMEs, specialising in local and global funding solutions for manufacturers.
Pfitz Financial has a wide range of clients from small to large companies, some of which are publicly listed, that operate in a range of industries including steel (metal), plastics, Defence, food and beverage, chemicals and medical sectors.
Sonja’s 25-year career in finance and in the ownership of various businesses has given her first-hand experience, and insights into the funding challenges faced by manufacturing companies.
Sonja’s advice for SME women in manufacturing businesses is “Own your vision with passion and transparency. Be wise in surrounding yourself with specialists in their field to support you and the growth of your business. Never take a setback or not winning a client as defeat or failure, it is a challenge that will make you even more successful, from the lessons you have learnt. Most of all take time to look after yourself… healthy mind and body, is a healthy, happy effective director.”
Of course, the picture isn’t completely rosy, as there are still hurdles faced by women running their own businesses. Various studies, both local and international consistently show that women entrepreneurs are hindered by three main issues in comparison to their male counterparts:
- less access to funding and capital;
- less access to supportive business networks; and
- unconscious gender bias by some male investors.
International Women’s Day recently brought some great focus onto women and their achievements. Hopefully we’re getting closer to a time when women’s contribution and achievements are recognised as a matter of course, not just on a special day.