In his 10 years running the Ballarat Business Centre, John Thomas has seen a lot of companies run into trouble, and when My Business asked him what most of them do badly, he didn’t hesitate. His answer: planning.
“Many of them don’t have a business plan. A lot of people are very skilled on the vocational side and they simply don’t see the need for the business side. They might be a highly skilled hairdresser or baker, but in my experience if they don’t plan adequately, their business will fail. The ones who get it the other way round and do really well on the business side, even if they’re not as skilled in what they do, tend to do alright,” he says.
Thomas’ business incubator has been helping small business owners to get themselves out of holes since 2001. “You’d be amazed at how many people have never seen a profit and loss statement,” he adds. “They run out of money and they don’t know why. They can’t go and see their accountant because they haven’t paid the last bill and things get pretty desperate.”
That’s where organisations such as the Ballarat Business Centre come in. Small business owners can benefit from their numerous workshops and gain access to professional advice and mentoring. “Obviously, by the time they come to us they’re pretty stressed so we offer psychological support as well,” says Thomas.
Of course, not all businesses make it. As Thomas knows only too well, you can bring a horse to water, but you can’t make it drink. “We had one business that was involved in the food industry. The big supermarkets had moved into their territory and the market for their product had disappeared. We kept telling them that they needed to find a new direction and they kept saying that we didn’t understand their business. They ended up failing because they were so passionately connected to their product that they couldn’t see beyond it.”
Knowing which advice to take, and which to ignore is one of the key lessons Thomas and his team aim to impart. “It’s about knowing the language of business and knowing where to go for help. People need to realise that business is a tough game and they will need to work extremely hard to succeed.”
Sometimes the best advice is to close the business, and in those cases the business centre can help prepare the business for sale or at least ensure it can be closed with dignity rather than in debt.
The Ballarat Business Centre takes all-comers, irrespective of size or industry sector. Thomas’ own background was in senior management at Telstra. “We’ve run strategic planning workshops for councils before now. It doesn’t matter how big you are, you still need to get this stuff right. You’re always going to find those people who find accounts too boring to bother with, or who spend money they don’t have.”
The business centre also manages 46 offices and eight workshops with occupancy rates consistently in the high 90 per cent range. “It gives people an opportunity to come out of their back rooms and sheds. One of the big advantages is that their business can stay in the business centre after they leave. At home things have a tendency to spread from the back room, to the dining room, to the living room and then there’s no getting away from their business.”
The income generated by the centre’s accommodation arm means that the Ballarat Business Centre is in the unusual position of being entirely self-sufficient. “I visited a number of business centres in Ireland recently and they were dependant on government assistance on so many different levels. We operate at a critical mass. The offices bring in enough income for us not to have to be reliant on anyone,” says Thomas.
He also offers assistance to people looking to start a business and recently received some money to help flood-affected businesses.”A lot of those people are effectively having to start a new business. Some inherited the original business or have run it for years and years and now they have to start all over again.”