We will have huge numbers of firms which will be struggling when the lights go on again all over the world (I can still hear my mother singing that song). We will need to be thinking what sorts of support we will need to be supplying to the businesses of this country.
The sort of support businesses will need will be exactly what the Minister of Finance announced last week. Most businesses will not pass solvency tests and the law will be changed to support the Directors from personal liability. I think 6 months will be too short, but I am sure this will be remedied in time.
In the 1980’s I was working in economic development. I was working for Community Employment Group. One day I was rung by Mike Kitchen who had been the chair of the Freezing Workers Union at the Whakatu Freezing works in Hawkes Bay. Mike is a remarkable person and we got on really well. Mike knew that I had a thing about how banks and the IRD were closing business after business. I had friends who were bank managers who told me how the philosophy of the leadership of banks had changed. It was more of a dog-eat-dog culture, and less of a “we’ll walk with you” type of thinking. Most of the bank managers I really respected either retired early or left to work elsewhere.
The IRD were just faceless pricks. Business after business were driven to the wall by people who had no idea of what they were doing to small business. I’m pleased to say they seem to have learned from this experience and are much better now.
Mike Kitchen had been laid off by an organisation led by a really interesting man called Athol Hutton. Mike had threatened to go and blow Athol’s head off with his gun when they were all laid off. However, by the time he contacted me they had sorted things out and were back on speaking terms!
Mike knew that Athol (who for his sins was a founder of the Business Roundtable, an organisation I despised then and still do) also had the same theory as me that we needed to build a support structure for small businesses which were struggling. So, he brought us together.
As a field worker I was supposed to work alongside a group and obtain funding for them. Then I was to stand back and leave them to it. Well that’s not what I did at all. Athol and I became the best of friends (at public meetings I generally spoke first. I would introduce Athol and say he was a founder of the Business Roundtable and what he was doing now was punishment for being involved with such a dreadful organisation, but, that he was showing early signs of being sorry for his behaviour).
So, between us, Athol and I started “Company Rebuilders”. I think I might have been an early Director to get it going. Can’t remember. The idea was we would establish a network of people who would work alongside troubled businesses and support them. We would locate where they were through another organisation, we had been working with, called Business Grow, a vital part of the Canterbury Development Corporation. We had established this as a visitation programme calling businesses seeing what support they needed. This programme continued for years under the wonderful Jill Tairoa. She was an absolute gem, supported by John and other members of the team.
Athol Hutton had a group of recently retired stock agents who fitted the bill for the sort of people who could run the field work for Company Rebuilders perfectly. These guys (there was ever only a couple of women in the team) had all worked for firms like Dalgetys, Pyne Gould Guiness etc. All of the firms had trained up their stock agents to look after the cocky at the end of the valley who was struggling. This had a commercial imperative, in that they needed their bills paid, but it was also something that the companies could do to assist the farming sector.
So, slowly, Company Rebuilders grew. We supplied them with an office and Athol and his Jack Russell dog, Henry Hutton, took up residence. Their meetings were always in our office. Slowly the stories expanded as we sat around drinking beer in a Government Department on Friday nights. The businesses they were working with were generally small. The difference between the boss and their staff was minimal. Many staff were whanau. They had all worked together, for sometimes decades. The restructuring of the economy had brought them to their knees. The entire family capital was in the business. This was their retirement nest-egg, and it was being mauled to death by the Banks and the IRD.
The team were paid petrol money and the cost of their internet. They established systems and one took this under his wing. They became marriage guidance counsellors and mates to those they were working for. They established networks of good people in the Banks and the IRD. Together they propped up businesses which were salvageable. They laid to rest, as sensitively as they could, those which were beyond saving.
I remember one big job. We went to Hawkes Bay. Birdseye in the UK decided to close the vegetable factory in Hastings. There was 300+ jobs at stake. By this stage Company Rebuilders was throughout NZ, and had achieved a bit of a profile. We were called in by the Government. We had become one of the tools in the toolkit! We went through the books and it was a very viable business if it didn’t have the albatross of head office overheads hanging around its neck.
A business plan was put together. I have a vivid memory of Athol standing on a table in a café room at the plant. Announcing to the workers present that it was a viable business and that we thought they should start a worker’s coop to run it. Athol stated what contribution would be necessary from each of them. He then said “who’s a starter?” Every hand in the room went up.
The business plan was supplied to a bank who approached a local business person, who decided that he would buy the business and over 300 jobs were saved. We didn’t care how we did it. We were there to save jobs and, hopefully, create even more.
Over the years which Company Rebuilders was operating over 10,000 carefully measured jobs were saved. This remarkable group of people gave so much back. They had a sense of fulfilment and every single wife of those in the team came to me and thanked me for giving their husbands a new purpose in life. It wasn’t me. I was just doing my job as a public servant.
We need something like Company Rebuilders again. The last team are now mostly all dead. Where’s the new team?