In safe hands

If you’re serious about growing your business, you need to surround yourself with trusted advisors. Patricia Moore talks to the professionals about how best to find and maintain key business partnerships.

Fast-growing start-up, potential exporter, long-established enterprise or high street store; regardless of the business you’re in, going it alone is no longer the smart option.
Professional service providers, offering everything from expertise in the law and accounting to human resources, web design, IT, marketing and more, are a vital part of today’s business team.
But engaging professional services is not like buying a product; you can’t kick the tyres or squeeze for ripeness. “Finding the right adviser can be something of a lottery,” admits Daniel Hunt of taxation specialists Daniel Hunt & Associates. “Business owners first need to identify their needs, then research professional firms that can cater to those requirements.
“The perfect fit will be a firm that is operated by reputable advisers and has a specialty area you can optimise – [for example] we know tax so you don’t have to.”
The right fit is the key – a bit like buying pants actually.
“You’ve got to find the person who’s willing to become a true business partner,” says Paul McPadden, KPMG national managing partner, business advisory. “You don’t come to me because I can do your tax work as well as anyone else. You’re coming to me because I understand your commercial business. I understand your day-to-day business issues; I’m sensitive to what your costs are. I’m sensitive to where you want to take your business and I’m there with you as a true business partner.”
“A business owner looking to improve the performance of their business needs an accountant who can take a wider view of their business,” says Margaret Holmes at the Engine Room. “One of the great things we’ve seen from the changes in technology, and the evolution of accounting products like Xero, is that it’s much easier for accountants to see how a client’s business is performing.”
And accountants need to ensure they’re learning skills other than just accounting and tax, she adds. “Accountants have always been trusted advisors to business owners but business and technology have changed a lot in the past five years and as business advisors we really need to have at least a broad understanding of what these changes mean for business owners.” (Holmes cites the case of a recent new client whose previous accountant was still using Office 97.)
NZ Institute of Chartered Accountants chief executive Terry McLaughlin says their members commit to continuing professional development which has direct benefits for clients using their services. “We’ve recently begun profiling SMEs around New Zealand that have benefited considerably from employing an NZICA member. These include an organic coffee brand that has thrived during the recession and a baby company that has grown 50 percent year-on-year.”
Look for genuine experience and expertise in the relevant business area, advises Michael Sage, partner in Simpson Grierson’s commercial department, who works with many emerging businesses. “In the context of lawyers it’s important to get someone who specialises in commercial law and who has access to other specialists in areas such as property, employment and tax.” Be very wary of anyone who claims to be a one-stop-shop, or an expert in all areas of the law, he says.
“The significance of building a relationship with a commercial lawyer is that they are best placed to provide the initial business structuring and contractual advice most start-up and emerging companies need as their first priority.”
Relevant industry knowledge is also very important, says Sage. “A good commercial lawyer who knows nothing about ICT won’t be much use to a start-up software company.”
Sage advises asking for examples of clients and of projects worked on. “While confidentiality requirements will limit what can be disclosed, anyone who can’t produce a comprehensive and relevant CV, with referees, within half a day, is someone to be wary of.”
Weighing up the cost
The cost of professional services is always a consideration. The advice across the board is to look for the best value for money. “View professional service costs as a business investment, not just an annoying cost centre,” says Sage. “The lowest cost will generally produce the worst result so is generally the biggest waste of money – and a frequent contributor to business failure.”
With more firms moving away from time-based billing, it should be possible to receive a quote before work is commenced, says Holmes. “If it seems unbelievably cheap I would have reservations about the quality of the services you’re getting.”
Shop around – Hunt recommends business owners obtain quotes from at least three different advisers. “At DHA we operate on an agreed fee basis so clients know the scope of the work and the expected fee beforehand.”
It’s another area where getting advice is important, says Michelle Malcolm, WHK principal – business advisory. “At WHK we get most of our new clients referred from existing clients who have used us for a while and like and trust the services we provide.”

Does size matter?
The choice of big firm or small may be dictated by the needs of the business but essentially involves choosing a professional partner with a genuine interest in your business, an empathy with you personally and with whom you feel you’ll be able to get along – particularly in difficult times, says Sage. “Personally I look for professional advisers who get to the point quickly, can tell me straight away what really matters and who are calm under pressure.”
KPMG’s McPadden concedes there is a perception that big equates to expensive although he doesn’t believe it’s the reality. “Clients need to make sure they are working with a firm that’s focused on adding value to their business – that’s the best way to ensure you’re getting a return on your investment.”
It all comes back to the needs of the business, says WHK’s Malcolm. “Corner dairy owners may not need the services of a large firm, whereas an exporter or someone with big expansion plans may need the business advisory service big firms can offer.”
Meanwhile, Margaret Holmes says Engine Room’s smaller size means they can easily identify with their clients. “We’ve undergone the same growth pains – employing additional staff, managing staff performance, managing cashflow, dealing with the recession.”
While a bigger firm may have a wider range of skills and resources on offer, Holmes says they find their size and flexibility appeals to similar-sized businesses, and their clients appreciate being able to call up and talk to the same people, any time. “One of our clients recently commented she felt as if she was the only customer one of our team members dealt with; we find clients really appreciate that personal service.”
Harris Tate director Katrina Hulsebosch says it’s basically about finding something that works for you. She says with smaller firms it’s generally easier to get hold of your lawyer and build a close relationship. “Larger firms are generally very competent and offer a wide range of experience, but fees may be higher and building a relationship not as easy.”

Two way street
The onus on building a successful relationship between business owner and adviser is on both parties, suggests Daniel Hunt. “At DHA we ask our clients what they expect of us so we know what we need to do to keep them satisfied.”
Hulsebosch is “a great fan of picking up the phone and discussing matters. Just talking to a client is good for maintaining the relationship. Going the extra mile is also important – Christmas cards, a call just to see how they’re getting on; a little interest goes a long way.”
The relationship is a collaboration, where client and adviser each have a key role, says Michael Sage. “Did the adviser do what they said they would on time and for the agreed fee? Were they easy to deal with? Did they help make sense of complex issues? Did they deal with unexpected issues calmly and effectively? Do you feel you can trust them and that they understand your business?”
The client must act in a similar way, adds Sage. “Provide information when needed, be accessible, explain carefully what they want to achieve and be easy to deal with. By not doing those things clients can be their own worst enemies.”
Engaging professional services from the outset can have a huge impact further down the line. Sage points out that at some stage a business will be sold or seek new investors or funders, and will be subject to due diligence. “Being able to show they have had highly skilled and well respected advisers on board engenders confidence in third parties. It can have enormous benefits.”  
Poorly structured businesses, without proper shareholding arrangements, employment agreements, option schemes, standard terms of trade, proper IP protection, and contracts with key customers and suppliers – for example – will suffer at this point, he says. “They are often ticking timebombs. By putting all those things in place with really good advisers a business owner will get a return on the amount invested in professional fees, and, more importantly, on all the funds and effort that have been invested in º

Thinking big
Smaller enterprises shouldn’t be afraid of approaching large firms for professional advice, believes KPMG’s Paul McPadden. He cites a “great business with a fantastic concept” they met with recently. It’s currently being trialled overseas and plans are to roll it out around the world. “It’s a one-person band at the moment but if it takes off in five or ten years it will be very large and very successful.” The business owner needs the sort of help a larger firm can offer, he says. “International tax help, asistance with managing cashflow, business planning and strategic planning – all things we can do to help the client’s business grow.
“The client came to a meeting thinking we wouldn’t be interested because they’re so small, but it’s a classic example of the sort of business we want to help grow and prosper and succeed.”
Another situation saw McPadden linking his firm’s supply chain expert with a client whose warehouse was overstocked. “We added value that went straight to the bottom line over a period of months and provided the company with a great foundation for managing their stock. It wasn’t me doing the work but the client relied on me to bring the right skills to the front.”

Patricia Moore is an Auckland-based freelance writer.
Email [email protected]

IT smarts
For a nation of do-it-yourselfers handing over the IT reins doesn’t always come easily. But going it alone can be costly, says Brenda Ford at Zoom Technologies.
“People tend to be price driven then find the equipment they’ve chosen doesn’t perform as expected. By having a good relationship with an IT company and consulting them before purchasing, you can ensure you’re getting the best bang for your buck.”
A professional IT provider can also help you plan ahead. “They’ll supply you with equipment that is able to grow with you,” says Ford. When equipment is due for updating, a professional IT company like Zoom Technologies can work with you to fit your budget and roll out equipment with minimal disruption to the working day, she says.
Another advantage is that your history is on file. Ford cites the theft of a client’s laptop as an example. “Because we had the purchase and serial numbers on file we were able to send the information direct to their insurance company and it was replaced the next day with no issues. All the information from the original install was also on file so they were up and running again quickly,” says Ford.  
As for choosing an IT partner – “don’t throw a dart at the wall,” says Ford. “Your best source of contact is word of mouth. Ask around and see who your customers are using. And make sure a potential partner is able to give references from current clients.”