disputes

TRANSCRIPT: Payment problems for small business, helping small business resolve disputes

Emily Carter — Thu, 01 Feb 2024 03:24:35 +0000

TRANSCRIPT: Payment problems for small business, helping small business resolve disputes Emily Carter Thu, 02/01/2024 - 14:24

01 February 2024

TRANSCRIPT

Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson interview with Jeremy Jones.

ABC Radio Capricornia

Subjects: Payment problems for small business, helping small business resolve disputes,

Jeremy Jones

Well, it's hard to think of something more frustrating: do the work, the long hours, not taking other work in the meantime, and then your client doesn't pay. Maybe they felt the price was too much or the cost of materials shocked them. Or maybe it was a miscommunication about the desired outcomes. Well, what can you do? What's the right thing to do? If you feel like you're dealing with someone dodgy, you want the whole world to know that they're dodgy. Or you just want your money. Or you just want the whole thing to go away.

Well, disputes about being paid, troubles with digital service providers and contract bills and franchise agreements are the top four issues where small businesses have sought out the help of the Australian �Թ�� and Family Enterprise Ombudsman over the past six months. The Ombudsman, Bruce Billson, joins me now. Bruce, thanks for your time.

Bruce Billson

Jeremy, fab to be with you and how good’s that 1976 song Rich Girl from Hall & Oates. A blast from the past and Fraser, on your board, was telling me you're in great form today. But one thing we can be pretty confident about is that small business owners, female ones, are not rich girls. In fact, nearly half didn't make a profit in the last full taxable year and about 73% who have their business as their full-time livelihood pursuit, take home less than full-time average weekly earnings. So, we're talking about people not rolling in rivers of gold. And yet, still, some people don't want to pay them in a timely way.

And this is the majority of concerns that are raised with my office. We set about trying to equip the business with some know-how to approach and raise the concern and, if necessary, get involved with some case management to get a better outcome and hopefully get businesses back to business.

Jeremy Jones

How common is pay disputes?

Bruce Billson

Spectacularly common. That's the sad thing. Two out of every five matters that comes to my agency involve a payment dispute.

Occasionally it might be a small business with another small business. It might be bound up with some misunderstandings about what each other wanted the other one to do.

It may be a big business simply exercising their market muscle and saying, we'll pay you when we're ready to.

Or worse, we've had some examples where we've had to lean into an arrangement with a government department and a small business supplier where they frankly just hadn't got around to paying them.

And it what's interesting, Jeremy, is, a bit like Hall & Oates, they want to keep the relationship going. In many cases it's a valued client. They just want to be paid. We try and share some know-how, give some tips on how to raise it in a way that will get an outcome, but hopefully keep relationships intact.

Jeremy Jones

It's interesting that you bring that up. I feel some people might think going higher to maybe the Ombudsman, it feels like you might be putting a nuclear bomb to the relationship because you're sort of taking it outside of, maybe the four walls of an email chain or something like that. How can you get desired outcomes when people have sort of taken their frustrations to the next level?

Bruce Billson

What we do is we work with the businesses that contact us. We've just ticked over our 40,000^thbusiness that we've assisted since the agency was established. We try and equip the business themselves to deal with and approach the matter first so that we don't need to necessarily get involved, but we are happy to share the know-how.

You touched on one of the dynamics that plays out here Jeremy. People can get frustrated; they can get emotional. And let's remember, a small business is often the identity, the personality, is more than just a job for a business owner. It's really what they're about. They put their heart and soul, and many mortgaged their houses for it. So, it's a big deal and that can also heighten the emotion.

And so, one of the things we do is we say don't raise that you felt slighted or shaded by a phone call you had two years ago and throw that into the mix.

Focus really on what the issue is, what the concern is you want to resolve and what a good outcome looks like and stay to that and engage. We help them prepare their own letters, some tips on how to raise a claim that they're supposed to be getting paid and no one's paid them. And really try and go about it in a classy way to give it the best chance to get resolved and then people can get back to business.

If that doesn't work, we’ll get involved and shoot a note out saying, hang on, you've engaged this contractor to tile a commercial building, and they've done all the good work and you haven't paid. What's the go here? What's your take on this? We're impartial, but we want to get an outcome. And they might just say, look, you know, few things are going on. How about I pay half of it now and I've got money coming in, I'll pay the next half next week. We will check in with the other party, make sure that works for everybody and away we go.

Jeremy Jones

I really appreciate the point you made there as well. In these situations, I can imagine for some it might be the contractor and then you go, well, you took a long lunchbreak when you did this and you did this, he did this. All these things that are maybe relevant to there being hard feelings, but not actual to the context of the situation in the payment at hand.

Bruce Billson

And not helpful to getting an outcome. You know, you start throwing in emotion, hurt feelings - we've all got those. But we try to stay professional. We try to stay focused. A real problem-solving lens. Our first step is to provide the business with some know-how, some approaches, some resources that are on our website, www.asbfeo.gov.au which is the acronym of Australian �Թ�� and Family Enterprise Ombudsman.

Jeremy Jones

Bruce, a big thanks for joining us this morning.

TRANSCRIPT: Helping small business resolve disputes, payment times, digital platforms

Emily Carter — Wed, 31 Jan 2024 23:45:33 +0000

TRANSCRIPT: Helping small business resolve disputes, payment times, digital platforms Emily Carter Thu, 02/01/2024 - 10:45

31 January 2024

TRANSCRIPT

Australian �Թ�� and Family Enterprise Ombudsman Bruce Billson interview with Leon Delaney.

Radio 2CC Canberra

Subject: Helping small business resolve disputes, payment times, digital platforms

Leon Delaney

Small businesses in Australia have sought the assistance of the Australian �Թ�� and Family Enterprise Ombudsman for issues including such things as payment disputes, trouble with digital service providers, contract battles, franchise disagreements. The list of disagreeable things that can occur to a small business appears to be endless. Joining me now, the Australian �Թ�� and Family Enterprise Ombudsman, Bruce Billson. Good afternoon.

Bruce Billson

Leon. Awesome to be with you and your listeners.

Leon Delaney

Thanks very much for joining us today. So how have you been able to help small businesses over the past year?

Bruce Billson

Well, the good news is we've been very busy and in fact, in the last few months, we ticked over our 40,000 small business we 've been able to help. And that's largely through dispute resolution services, better practice guidance to help people avoid getting into difficulty in the first place, and also at times calling out the behaviour of some big businesses and occasionally governments that aren't really playing that nice with their small business customers.

Leon Delaney

Well, obviously, if the big if the big businesses and the even the governments don't play nice, who's going to set an example for everybody else?

Bruce Billson

Well, we hold up a bit of a mirror at some times and say, look, really, is this the way we want to be treating really important suppliers that are small and family businesses?

And what we're seeing more and more of Leon, is two out of every five of the disputes that come to my office involve payment disputes. So, this is just where people just want to be paid for the work that they've done. And in some cases, the bigger parties - big business or others - are just a bit tardy making those payments, not realising that cash flow is the oxygen of enterprise. Those businesses are hanging out for that payment. They've often incurred costs to provide goods and services as part of their contract, and they just want to be paid.

So, two out of five of those and worryingly, Leon, in many cases, parties are just slow to pay because they can. And the small the family business lacks the market power and presence to be able to bring about a change in that behaviour.

Leon Delaney

It's that power imbalance that really does create the problem, isn't it? And when you talk about bigger businesses not realising the importance of cash flow. Oh no, they do, they do. But they're only concerned about their own cash flow, not somebody else's. That's the problem. In some instances?

Bruce Billson

It is, and that's partly why we were really positive that the government looked at the payment times register.

We'd been calling out pretty shabby business performance where, in some cases, one in four were taking over 100 days to pay. This just isn't right. And what's happening is this is increasingly becoming a focus, even overseas there's campaigns like ‘Good Business Pays’ where they hold up information in public view to show who is doing the right thing and who's gaming their market power. So, there's stuff going on there, but it's still happening. It's still a concern.

Although digital service platforms are the fastest growing area of disputes we've been involved with.

Leon Delaney

Yeah, we've spoken about dealing with digital platforms on a previous occasion and of course in the modern business environment, there's no escaping the need for digital engagement at some level, is there?

Bruce Billson

Well, that's right, and it's changed everything for many small and family businesses. The way in which they identify and engage with their customers is through a digital platform. Some of those platforms are really helpful in bringing the eyeballs and customers to maybe a new business or a niche business that doesn't have endless amounts of cash to go out and market and find those valued customers.

But the flip side is if something doesn't go right, Leon, can you imagine how annoying it is that your accounts on one of these platforms might have been hacked? It's been shut down, but to actually register a concern and get it fixed, you've got to get it to the very account that’s no longer available to you.

That's the ultimate run around. And that's why we've been saying to these digital platforms, come on, guys, you can do better than that. Have internal dispute resolution mechanisms. Have available a real human to speak to, where you know the frequently asked questions don't solve the problem and if all else fails work with us just to make sure those enterprising men and women can stay in business.

Leon Delaney

This question of having a real person to speak to, I mean, this has been a phenomenon now that's been expanding for a couple of decades. I remember years ago I was thumping the table, suggesting that if I was handed the job of dictator of Australia, one of the first things I would do would be to pass a law requiring all government entities and large businesses and corporations to make sure that the phone is answered by an actual human being, which would solve two problems: the problem of customer service and it would also provide more jobs. I mean, really it's a win-win, isn't it?

Bruce Billson

Leon that's a cunning plan of yours.

But that's the challenge. You often see technology helping to guide a call to where it needs to be. If your concern is about the high-rating Canberra talk show, push 1 for Leon Delaney. If you want to talk to a handsome radio jock, push 2 for Leon Delaney.

But at some point you get to a problem where the frequently asked questions, the automated sort of effort to resolve, isn’t there and you just want to talk to someone to get it done. And that's at the heart of what we try and do Leon. Many people want to keep these business relationships going. They've got a dispute, they want it sorted and then they want to get back to business, hopefully with the relationships intact. And that's the approach that we take. And it's a terrific service.

Leon Delaney

Now, in terms of payment terms, I note that the �Թ�� Minister Julie Collins, who now has your old job, has provided information today showing that payment times have improved, but there's more work to do.

It turns out, according to the figures that she's presented today, the average payment time for a big business to pay a small business is now down to 35.4 days. So, in other words, it's more than 30 days. And that represents an improvement? It's still too long, isn't it?

Bruce Billson

I welcome the Government's interest and Minister Collins’s activity involved in highlighting these things. We've been banging on about it for some years, saying, 30 days is hardly shooting the lights out. We know during COVID that some of the biggest businesses in the country were paying their small, family and indigenous suppliers within three or four days. So, it's not a question of whether they're capable of doing it. It's whether there's the appetite to do so?

And what we think would help, and what a recent review of the payment times reporting system has suggested, is we need some way of proclaiming, naming and shaming. Really putting a spotlight and praising those that are doing well, naming those that are not doing so well and maybe pointing to some of their competitors saying, well, they can pay in seven days, why can't you?

And then for those that are really shabby, and I mentioned earlier some are 120 days plus, we need to get out there to say this is just not classy. This is unacceptable. This is really misusing a dominant market position for the harm of small and family business suppliers.

Leon Delaney

If somebody is running a small business and they're running into some of these obstacles, how do they get in touch with your dispute resolution service?

Bruce Billson

Jump on our website www.asbfeo.gov.au No Leon, that is not a foot fungus from Latin America, that’s the acronym of Australian �Թ�� and Family Enterprise Ombudsman. There’s some helpful tips there, because many times it's about building capability to raise concerns. But then if that doesn't work and people have had a go at it, then we can get involved in our brilliant case managers can really look for a path forward to resolve the dispute.

Leon Delaney

Fantastic. Bruce, thanks very much for your time today.

Bruce Billson

Great to be with you.

Leon Delaney

Thank you. Bruce Billson, the Australian �Թ�� and Family Enterprise Ombudsman.