SMEs and the question of trust

At a recent meeting, one of the brand managers I was talking to was claiming SMEs don’t trust anyone: “How can we get them to trust us?” they asked.

I do a lot of work with SMEs and I love dealing with them. I’m an SME owner too. But this person’s observation struck me as having an element of truth to it. Australian small business people can be pretty sceptical, even cynical sometimes.

That’s not necessarily the same as being negative. Generally I find the overwhelming majority of the SMEs I’ve worked with have a positive attitude and outlook.

But I think so many have been burnt by dealings with big businesses and the major banks, government departments and bureaucracies — and sometimes even their own employees — that they’re always looking over their shoulders, wondering “Who’s coming after me next?”

That’s a tiring way to live. Is it just paranoia or something more?

Government departments and authorities seem to spend half their time cracking down on small business. Hardly a month goes by without headlines telling small businesses the Australian Taxation Office has them in their firing line.

Here’s a quick sampling of SmartCompany stories from the past two months on the ATO pursuing SMEs:

The ATO has certainly picked up the public mood recently in going after bigger multinationals, and it has a big case on its hands with American energy giant Chevron right now, but it’s still finding time to play schoolyard bully with SMEs.

Fair Work is also always ready to pounce on business owners. And compliance obligations could be getting even stricter if the Fair Work Amendment Bill 2017 is passed.

According to payroll compliance company TANDA, the proposed change could see companies liable for far bigger penalties if they fail to comply with the law, with a tenfold increase in fines for companies from $54,000 to $540,000 and individuals from $10,800 to $108,000. That increase might be wearable for big firms, but would kill off most smaller businesses.

Some of the issues surrounding the attitude of the Fair Work Commission towards small business were aired recently when former vice president Graeme Watson resigned. As SmartCompany reported:

“Watson was also critical of the Fair Work Commission’s unpredictable approach to unfair dismissal cases, claiming business operators don’t trust that they will be protected from employees who have been let go because of underperformance.”

If looking over your shoulder for regulators is not enough, big business and banks won’t think twice about trampling all over SMEs in pursuit of their goals or simply viewing them as ‘marks’ for upselling, rather than treating them as valued clients and business partners.

Judo Capital* co-founder Joseph Healy hit the nail on the head in his article in The Australian about the lack of trust between small businesses and big banks. As Healy says:

“Big banks are now not so much about the traditional relationship practices of trust and depth of understanding, but more about selling — a never-ending push to upsize, to offer more products.”

No wonder SMEs are so wary.

Returning to our brand manager’s original question: “How can we get them to trust us?” Treating them with some trust, respect and support would be a good start.

*I am a board member of Judo Capital.

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Katrina Puranik
Katrina Puranik
5 years ago

Local economy benefits from strong community networks. Which is the easiest why to build trust, and mutually beneficial relationships with our competitors as we work together. There will always be other plumbers in your local area, but if they work together they can build more business with trust, and building their businesses together so that the local community needs are met, and their reputation increases.

Local businesses should definitely seek local products and services. I have seen this work through local professional networking events – the process works. I cannot say it enough.

Please visit my website to contact me if you have any questions?

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