The commonly held perception that millennials are self-entitled, lazy and naïve has been dispelled by new research showing that more young people are starting and planning to start small businesses than any other generation.
Shop Small is a nationwide movement that brings together support from the business community, governments and consumers to support small businesses and shows it is not all about the big businesses anymore. While one in five Australians on average are looking to start a small business, that figure increases to almost 40 per cent for people aged 18 to 24, according to The Economy of Shopping Small: Custom Counts report.
Currently 22 per cent of small businesses have been started by school leavers and university graduates, with the number predicted to increase over the next few years, the report – commissioned by American Express and conducted by research firm RFi Group – found.
The drive for young people to “be their own boss” is spurred by both changing cultural dynamics and economic environments, Macquarie Graduate School of Management lecturer, Dr Lara Moroko says.
“We’re seeing a real shift in the make-up of Australian small business owners, which we can attribute to a few key behavioral and cultural changes.
“There is this palpable undercurrent of entrepreneurialism in those ages 20-30, coupled with a desire to work for themselves and enjoy what they do as opposed to turning up to work for a salary,” Dr Moroko said.
Traditionally, the majority of university graduates and business school students have aspired to long term careers in “solid”, socially desirable jobs that are financially secure. However a changing economic outlook and uncertain job market has led many student to re-evaluate their plans as they recognise that traditional careers can take “a long time to bear fruit”, Dr Moroko says.
Instead, many young people want to “capture value for themselves” and invest in their own business ideas, rather than working hard for and creating value for a larger company as an employee.
“Over the past few years, there have been some amazing small business role models that have paved the way, sparking the entrepreneurial spirit in the millennials who are picking up the small business baton,” Dr Moroko said.
Currently the average age of Australia’s two million business owners is 42, with 36 per cent aged 34 and under. More than 60 per cent of business owners are male, according to the Customer Counts report, however younger entrepreneurs are slowly correcting the balance. More than a quarter of women who are currently not involved in small business plan to start their own venture, compared to 17 per cent of men.
Young entrepreneurs might be on to something in terms of their timing, according to the report. About 85 per cent of the small businesses surveyed said the were in a similar or better financial position than they were this time last year.
Where there’s passion, there’s success
Like many young business owners, Miga Aboulian spent a few years trying her hand different careers before deciding to start her Sydney- based boutique store, Lixie Chocolaterie.
Being her own boss and working with a product she was passionate about were the main reasons Ms Aboulian started the niche business two years ago, however spending most of her childhood in small businesses also played a role.
Ms Aboulian had grown up in the small businesses operated by her parents where she was required to contribute. Her parents have been her main supporters and her “sounding board”, regularly offering advice when she comes up against challenges.
“I was never scared of small business – I grew up with it. But I knew how much work was involved from the beginning. I joke that I was a child slave in my parents’ businesses,” she says.
After completing a short course in chocolate making, she approached a French master chocolate maker, Herve Boutin and propositioned him to teach her all he knew. Mr Boutin said yes, and the pair spent two years learning from the master and a lot of time perfecting her craft in her parent’s garage.
The appeal of running a small business was born out of passion rather than entrepreneurial drive, Ms Aboulian says.
“Chocolate is something I am passionate about. It is something that always makes people happy,” she says.
The best thing about running her own business, according to Ms Aboulian is being her own boss and making her own decisions, “right or wrong”.
Vice President, Small Merchant at American Express.
Shop Small is a nationwide movement that brings together support from the business community, governments and consumers to support small businesses. Shop Small began on October 31 and runs for the entire month of November.
To celebrate Shop Small, American Express sent cultural archivist and photographer, Eamon Donnelly on a trip around Australia with a brief to capture images of the dynamic and diverse small businesses who play a large role in our community and to help tell their story.American Express Facebook Page
The greatest challenges are the hours – six days a week with a minimum of 12 hours a day (often 16 hours) – managing cash flow and the peaks and troughs of business. “I have learned that in order to run a business you need to wear many hats.”
“The first year was a big mental challenge. It was difficult not to freak out when you might only get $50 of sales in one day and then run off your feet the next day. My father always says: ‘business is not an easy beast to manage’ and I now know what he means.”
A small business that doesn’t have the passion of its owners behind it is destined for failure, Ms Aboulian says.
“A mother and daughter came into the shop recently and the mother said: ‘This is great. I want to open my own business like this,'” she says. “I said: ‘If you do decide to start your own business be 100 per cent sure you have a passion for it. Without that, you won’t succeed.'”
Lixie has been operating for two years, but to Ms Aboulian, it still feels like early days. She says the next year will be spent solidifying operating practices and learning more about her business. “I still get nervous sometimes. People talk about opening more stores, but for me, if I can do one really well, then that would be enough for me.”
Without support, failure is imminent
Despite young entrepreneur’s appetite for starting new ventures, Federal Small Business Minister, Michael McCormack says more needs to be done to support small businesses.
With more than 2.1 million small businesses employing more than five million Australians, the sector accounts for 97 per cent of all Australian businesses are is crucial to the success of the economy, he says.
“It just makes good sense to have a thriving small business scene in our country and to ensure Governments, consumers and Australians support it as best we can,” Mr McCormack says.
Speaking in support of The Shop Small campaign — an initiative started by American Express that encourages Australians to shop local for their the month of November – Mr McCormack says that in order to be successful, small businesses require regular patronage.
“Each day every Australian should ask ourselves what we can get from our local stores or the latest online boutique. There’s no better time than Shop Small month to start that movement…particularly as the retail sector picks up in the lead-in to Christmas.”