New regional businesses need better support

2 MAY 2017

CSU experts in starting up businesses in regional areas worldwide believe these start-ups need and deserve more support than their city cousins.

Charles Sturt University (CSU) experts in starting up businesses in regional areas worldwide believe these start-ups need and deserve more support than their city cousins.

Prof Morgan Miles "Entrepreneurs and small business managers in capital cities and other urban areas enjoy better developed and more supportive 'entrepreneurial ecosystems' than their counterparts in regional Australia," said Professor Morgan Miles, who recently joined CSU from the University of Canterbury in New Zealand.

"These ecosystems, which are very specific to the location of the business, encompass access to a vast array of services and conditions that encourage businesses, from personal business skills to national and local government policies.

"Ecosystems both facilitate and constrain start-ups and small businesses in a city, a regional area or a nation to be innovative and economically efficient and effective."

These services and conditions include proximity to customers and suppliers, entrepreneurial and managerial expertise, breadth and depth of its skilled workforce, access to equity and debt finance, business support programs and services, government, institutional and regulatory frameworks, education, training, technology development and transfer, infrastructure, cultural support, and engagement with universities, TAFEs and research institutions.

In helping build such an ecosystem, regional and local government agencies have sought to attract more diverse industries to a region, as it is commonly believed that more diverse industry within a region leads to better performing regional economies.

Prof John Hicks However, CSU Professor of Economics John Hicks believes this is not always the case.

"The impact of a new industry on a region, particularly on employment, depends on the type of linkage that industry has with regional communities," Professor Hicks said.

"For example, we have shown that if an industry obtains its labour, raw materials and component parts from within the region and exports most of its output outside of the region, then it is likely to have a greater impact on regional growth and employment than if it imports inputs from outside the region and supplies its output primarily to the region.

"Therefore, Australian regions need to attract businesses capable of selling goods and services to markets outside the region, while existing businesses need think how they can expand by tapping markets outside the local.

"They may need help to do this, which points to the need for entrepreneurial ecosystems to reduce impediments to entrepreneurs capturing existing business opportunities."

To better focus the development of entrepreneurial ecosystems in the NSW Central West, Professors Miles and Hicks joined Professor Mark Morrison and entrepreneurship expert Mr Troy Haines from theSPACE in Cairns, Queensland, to present their investigations and ideas in a forum of business facilitators hosted by CenWest Innovate on Friday 28 April at CSU in Bathurst.

Regional CenWest forum 2017 Titled 'Developing Regional Entrepreneurial Ecosystems: How to best support the development of business in your region', the forum gathered economic development officers and other staff from Central West and Orana local area councils, and representatives from business support organisations including Regional Development Australia, local chambers of commerce and the NSW Department of Industry.

Local business leaders discussed the critical characteristics of effective regional entrepreneurial ecosystems, and how to encourage innovation and economic and jobs growth in the Central West and Orana regions.

Participants also considered the factors that assist and constrain entrepreneurship and small business development, and potential opportunities in their region to obtain better support and solutions to mitigate the constraints of entrepreneurship and small business development.

Professor Mark Morrison "Businesses are becoming more aware of the critical elements of entrepreneurial ecosystems, and what matters most can be different for regional economies," Professor Morrison said.

"So we need to harness our natural assets, improve access to knowledge, and develop infrastructure, finance options and export supply chains.

"We also need to support people, by developing clusters, networks, leadership and human resources in addition to entrepreneurial capabilities."

Media Note:

For interviews with Professors Morgan Miles, Mark Morrison and John Hicks, contact CSU Media.

Professor Morgan P. Miles recently became Professor of Entrepreneurship at Charles Sturt University. Prior to that, he was Professor of Entrepreneurship and Innovation at New Zealand's University of Canterbury, Tom Hendrix Chair of Excellence at the University of Tennessee – Martin, USA, Professor of Enterprise Development at the University of Tasmania, and Professor of Marketing at Georgia Southern University, USA.

Professor Miles is currently working with the Australian Department of Industry on entrepreneurial support program policies dealing specifically with business 'accelerators' and 'incubators'.