“I’ve never found the government support for export assistance to be particularly useful.”
That’s what Pat Boland, the co-owner of industrial tool manufacturer ANCA, told me when I interviewed him just after his Melbourne-based business was awarded exporter of the year.
Boland says that in his experience you are better off doing things yourself than relying on the government.
It’s a sentiment I’ve heard repeated across different industries and businesses in Australia.
Australia’s a relatively small market and for many businesses exporting is the key to growing their business, but for too many SMEs exporting is simply in the too hard basket.
The latest statistics from the Australian Bureau of Statistics show that during September, exports were down 1% and, worryingly, Australia’s main source of export income is from minerals, in particular, iron ore – and not a lot else.
SMEs are doing it even tougher with a case in point being this year’s Smart50 awards where the title of exporter of the year was taken out by website marketplace Flippa.
Flippa was a deserving winner, recording strong growth with almost 80% of its sales generated overseas, but amongst the list of Australia’s fastest growing SMEs there were less than three who actually export.
Businesses who want to export are hit by the high labour and regulatory costs in Australia along with an ongoing lack of certainty around the limited government assistance available.
Exporting generally takes a long-term approach and plans that develop over several years, not plans that can be chopped and changed along with government policy.
Only last month we revealed the Federal Government is cutting $25 million a year from the drastically underfunded Export Market Development Grant, in yet another reduction of the scheme’s power and reach.
The cut comes alongside what the government calls a “retargeting” of AusTrade, which industry insiders believe to be a focus on more nations in the Asia-Pacific and a closure of offices in North America.
It’s incredibly short-sighted given that a review of the EMDG scheme conducted by AusTrade in 2000 found that for every dollar granted through the scheme, it generated $12 in return.
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Cutting that money has reduced the government’s own opportunity to collect revenue.
Exporters like ANCA and Flippa aren’t complaining, they are just getting on with the job of promoting their Australian made and designed products and services around the world.
But as Boland notes, “the Australian government, by policy, gives absolutely no preference to Australian-owned firms, which is actually pretty unique in the world.”
No wonder our exporters are missing in action.