Business / Covid 19

Business advice demand 'phenomenal' after government funding

18:57 pm on 14 July 2020
Tom Kitchin, co-host of The Detail

Business advisers say they have seen a 'phenomenal' increase in demand as Covid-19 hit.

Paul Freeman of Stim Craftsmanship and Minister of Small Business Stuart Nash at an announcement of extra funding for small businesses. Photo: RNZ / Tom Kitchin

The government today announced it will give out another $40 million in support for small and medium enterprises from the Covid-19 response and recovery fund.

The money will go towards the Regional Business Partners network.

The organisation said in Hawke's Bay it had helped three times as many as it would normally see in an entire year.

"In Hawke's Bay here alone, we have already seen 600 businesses access the help," business growth advisor Leonie Wallwork said.

"Of those 600 businesses, 400 plus are new to our team."

Paul and Sharron Freeman operate Stim Craftsmanship out of their garage in Napier and received some of the earlier funding.

They turn retired wine barrels into furniture and works of art. After only about 18 months in business, Covid-19 changed their fortunes.

Paul Freeman said demand dried up within a day.

"Covid was a major for us. We went from what we thought was success to a month where we sold virtually nothing and we were like 'oh my god, we're going to lose our house'."

Stim Craftsmanship's workshop. Photo: RNZ / Tom Kitchin

The Freemans needed advice and turned to the Regional Business Partner network who help firms with advice on most, if not all, aspects of their business.

Wallwork said there had been a "phenomenal" increase in demand for the service since Covid-19.

"Cash flow was a big point of pain in the outset then there was sort of moving through how to deal with their people and restructuring."

She said in the past six weeks, there had been a focus on getting companies online so they could sell their products over the internet.

Small business minister Stuart Nash and economic development minister Phil Twyford joined the Freemans in their garage to announce the extra $40 million in funding this morning.

The money is on top of $15m already allocated to the regional business partners scheme through the Covid-19 response and recovery fund.

Nash said it was always going to be tough for businesses to get through.

"One thing we know about Covid, no matter how good a business person you were, you just can't plan for that level of uncertainty.

"There's two ways we could have done things - we could have shut up shop and gone down the austerity route or we could have said 'Hey, we've got the biggest chequebook in the country, we need to ensure our businesses survive'."

Twyford said any business with up to 100 staff could get support from the regional partners network to the value of up to $5000.

More than 6200 have used the scheme so far and a further 4600 have registered to take part.

The new funding includes $37.25 million to directly fund the professional services and $2.75 million to increase resourcing in the network.

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