Business leaders are urging caution as Indigenous owner-operators race to catch a ‘multi-billion dollar wave of opportunity’.
Almost 12,000 contracts worth more than $1.8bn have been filled by Indigenous business since 2015, under the Indigenous Procurement Policy (IPP).
This in turn has led to a rapid rise in the number of Indigenous businesses nationwide. It's estimated that up to 16,000 Indigenous businesses are operating in 2019, and that number is growing steadily.
However, the NSW Indigenous Chamber of Commerce says too often, start-up businesses fail because they rush in.
“Indigenous businesses are faced with opportunities that are very tempting, and sometimes they’re not set up to take on that opportunity but they jump, and sometimes they’ll jump too early” says Deb Barwick, CEO of the NSW Indigenous Chamber of Commerce (NSWICC).
“Businesses will race out and buy equipment and vehicles and we cringe because they should not be doing that,” she says.
In order to guide small business through the crucial start-up phase, the NSWICC has built a modern co-working facility that offers mentoring and training in the commercial heart of Sydney’s Redfern.
“And we are very excited about being here, and quite frankly it’s the place for this hub as the first of its kind,” Ms Barwick says.
The NSWICC aims to make the hub self-sustaining, through income from tenants and training.
“This facility being Aboriginal run and controlled, and full of Aboriginal people in business, will become a very important and iconic place for Redfern,” Ms Barwick says.
The building is owned by the Indigenous Land and Sea Corporation, which helps Indigenous people towards financial independence.
And after a career leading change in Indigenous communities, Ms Barwick has plans for similar hubs Australia-wide.
Builder Gavin Lester is one of the first tenants. His team from Molly Madar Construction has transformed the space, for offices, meeting rooms and casual hot-desking.
“To see this come to fruition after 10 years (of planning) is really, really good,” the former professional Rugby League player says.
“I get a bit emotional about it. And I’m excited that we are making a difference for the next generation coming through”.
Gavin is also a graduate of the Chamber’s business mentoring program and says it’s helped him plan for the future.
“Molly Madar Construction is turning over a couple of million dollars a year, but in the next five years I want to see a turnover of $10-15m a year, and sustain that level,” Gavin explains.
The Federal Government credits the IPP for a 30 per cent rise in Indigenous-owned business. Under a new target announced by Prime Minister Scott Morrison, 3 per cent of all Commonwealth contracts are to be awarded to Indigenous business.
"There is a multi-billion dollar wave of opportunity through IPP," Ms Barwick says.
“So Aboriginal people are looking to get into business, and if they are in business they want to grow their businesses. And for that, they need to have support from people who understand their background, and what they’ve gone through,” she explains.
The CEO of Arrilla Indigenous Consulting, Shelley Reys is a leader in cultural competency training. She says removing isolation for owner-operators is key.
“When I started my business 26 years ago I was pretty lonely, as there were very few Aboriginal people in business at that time,” Ms Reys says.
“So there’s value in bringing Indigenous people together, who are entrepreneurial and want to test ideas and test the market as well. And they can support one another at the same time.”
Deb Barwick says the Redfern hub will provide business networking opportunities for Indigenous business owners.
“As well as shared facilities there’s a little lounge area, so people can get together and take a break from coal face, and spend some time with each other through the hard times perhaps, or to brainstorm ideas, or make contacts,” Ms Barwick says.
“Our people are becoming independent and self-reliant, and the role modeling offered here is unbelievable. This facility will allow us to showcase what our people are really about.”
“We are a strong people, and we’re resilient and innovative and we know how to step up to the challenge.”