What is the issue?
Small firms form a key constituency of many local economies. At a national level, the 1.1 million small firms (with less than 250 employees) and 2.9 million freelancers and sole proprietors provide over 13 million jobs. So any major redevelopment or regeneration project should involve the many small businesses which together act as a significant economic driver.
Small businesses are generally misunderstood. Like people they are a pretty heterogeneous group. While there are common business approaches and attitudes there is also a wide variety of motivations for being in business. In London over a third are family owned and run businesses. Rather than purely pursuing profit at all costs, people starting businesses are often looking for autonomy, a way into employment when others routes are closed or for a personal challenge.
Engaging with small businesses is becoming more important. The increased requirements for consultation under the Planning and Compulsory Purchase Act 2004 mean that understanding how to consult with small businesses is rising up the agenda. Statements of Community Involvement will need to explain how communities and stakeholders will be engaged in the preparation and revision of local development documents and consideration of planning applications. Involvement should aim to be “active, meaningful and continued throughout both processes” and should include local firms or their representatives. Furthermore, the start of the Local Authority Business Growth Incentive Scheme in April 2005 will give Local Councils the potential to secure direct financial incentives from promoting local economic growth.
Why engage with small businesses?
Small businesses are interested in their local area. As they operate locally they have a distinct interest in the local environment and often a good local knowledge that can help professional planners, architects and regeneration professionals in their work. All will be interacting with the local council, have a high concentration of local employees (who all have votes) and often live nearby with children at local schools. They invest in the local area, especially if they are freeholders, and their support can be vital for physical and transport developments. The growing number of Business Improvements Districts (BIDs) have firms paying for and taking control of increased local service provision.
Engagement should also be seen as an insurance policy to prevent poor relations with local businesses. Freeholding small businesses can landlock a major development. They can be vocal in the local press. They can move to other areas taking valuable local jobs and supplier contracts. They can disengage from regeneration activities (e.g. training and mentoring opportunities).
How to engage with a small business?
You have to start thinking like a small business to appreciate what will concern them. Firstly, they value clear information to help the sort of decision making they do all day long. Many of their concerns are due to a lack of information and most are persuadable by reason. They want to know the timescales of activities to assess how it will affect their business. Secondly, and this may seem obvious, at the very least between 9 a.m. and 5 p.m. Monday to Friday they will be working. If you want to talk to them or get them to meet don’t take away a great chunk of their working day. Thirdly, they like action. They will not understand why something takes weeks to happen let alone months or years. They have to respond to customers and suppliers rapidly. That will be their culture. They won’t sit in meetings that are going nowhere. Fourthly, they operate on trust and value consistency. If they say they will do it they mean it. So non-action from a public organisation suggests the sort of unreliability that makes a small firm nervous. Lastly, to run a successful small business you will have to be resourceful, tenacious and adaptable. Respect small businesses for this and avoid being the professional who is lecturing them.
Turn the tables, use their 4 Ps
One of the oldest concepts in marketing is the Four Ps. Use this approach to engage small firms as “customers”:
Product: What are you offering small firms and what do you want in return? Do you know enough about your local business base to do this? Information should be business focussed and clear. Additional benefits (e.g. the opportunity to network with other local firms) will increase the attraction.
Place: Where and when are you going to do this? Think in terms of business hours and informal locations that you would like to go at the end of the day (i.e. not a rush-hour crawl across town to a Civic Centre).
Promotion: How are you going to communicate with your local business base? Try to understand their preferred and valued communication channels and use them. This may mean hanging round a café on an industrial estate or using an intermediary organisation.
Price: Do you understand the financial costs and benefits of a development or a regeneration project for the local businesses? Small firms’ fear of CPO may come from a lack of knowledge. Once this is overcome they tend to be happy to negotiate as they do that all the time.
Case Study: Tottenham Hale
North London Chamber of Commerce on behalf of the London Borough of Haringey have been engaging small businesses to ensure they are involved in a proposed 138 ha development around Tottenham Hale in North London. To do this North London Chamber of Commerce has acted as a neutral but informed business intermediary between businesses and the public sector. There are significant advantages in both directions. The local businesses have been helped by having a co-ordinating organisation to listen to their concerns, run a series of business friendly events and provide clear information. The local authority and their professional advisers have the advantage of being able to engage with an existing business group, gain an understanding of the local business base and to develop productive working relationships.
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