GROWTH FIRMS SUPPORTED IN SCOTLAND BUT NOT WALES?

Western Mail Column 
10th September 2011

Next Friday, the annual awards dinner for the Wales Fast Growth 50 will take place in Cardiff.

I am proud to say that the event has been sold out for weeks and promises to be another night that celebrates the best of Welsh entrepreneurship.

The dinner will be followed, on September 21st, by the publication of the thirteenth Fast Growth 50 supplement in the Western Mail.

Having spent every spare hour during the last four weeks putting this together, I am proud to say that the profiles of every business featured this year is a testament to the variety of successful ventures of all sizes that flourish in all parts of Wales.

Yet, it would seem that those in charge of economic development in Wales remain reluctant to engage with these high potential companies.

Even when the Welsh Government, six years ago, acknowledged that it should give extra support to a smaller group of firms through the knowledge bank for business (KB4B), there were very few Fast Growth 50 firms invited to join. Instead, the vast majority of participants on this programme were mainly the so-called anchor companies so beloved of the CBI and the current government.

Given the fact that every year, the fast growth 50 firms make a disproportionate contribution to the Welsh economy and have the potential to grow further with the right support, one has to wonder why they continued to be ignored by  policymakers in Cardiff Bay?

Interestingly, the same issue has recently been raised in Scotland, following a study of high growth firms by Professor Colin Mason of the Hunter Centre for Entrepreneurship at the University of Strathclyde.

According to Professor Mason, there are 825 high growth firms identified that make up only 4 per cent of the Scottish business population. However, they employ almost half a million people and account for 50 per cent of all new jobs in the economy.

Following the publication of this study, more enlightened policymakers in Scottish Enterprise (the main economic development body North of the Border) have come forward to propose that increasing the number of fast growing firms could have a transformational impact on the Scottish economy.  They estimate that increasing the number of high growth firms by 25 per cent over the next decade could create over 100,000 jobs.

It is also worth noting that, as with every Fast Growth 50 list for the last thirteen years, those firms growing quickly in Scotland were to be found across a wide range of industries, with very few operating in high technology sectors.

Indeed, Colin Mason was at pains to emphasise that policymakers should not prejudge the sources of high growth firms and the eligibility criteria for business support should be as open as possible.

Contrast that with the current logic of the Welsh civil service, which led to the last Minister responsible for economic development to focus only on six key sectors, with financial support only available to those businesses within a narrow range of industries.

Perhaps the key finding from the Mason report, replicated in other studies, is that you do not need to be based in a technology sector such as biosciences or ICT to engage in innovation and grow.

On the contrary, the Scottish research found that most growth firms, regardless of industry, were highly innovative, customer focused and internationally orientated.

As a result of this work from Strathclyde, it would seem that Scottish Enterprise has appreciated, unlike the Welsh Government, the scale of the opportunity and the importance of nurturing those companies that can develop into the big players of the future.

We will have to wait and see whether the Scots now focus their policy efforts on those companies that have the ability and appetite to grow but certainly, there is finally an appreciation in one devolved administration that it can, even without fiscal powers, help develop the indigenous business base and perhaps create some of the real supergrowth companies of the future.

One can only hope that politics and policymakers in Wales have a similar revelation soon.

MAKING THE MOST OF SOCIAL MEDIA - PIER 64 SHOWS THE WAY FOR WELSH BUSINESS

WESTERN MAIL ARTICLE SEPTEMBER 3RD 2011

Earlier this week, I had the pleasure of reading a new report, entitled "the Leisure Wallet”, which examines the state of the leisure industry in the UK during 2010-11 including how and why people frequent pubs, bars and restaurants.

Given the current economic climate, it made for fascinating reading, For example, whilst there is a general acceptance that consumer spending will be lower, there remains, not surprisingly, resilience amongst 18-24 year olds who see going out as a critical part of their lives.

The over 55s are also continuing to eat and drink out of the home regularly and are committing higher levels of their leisure spend to UK and overseas holidays and leisure breaks.

In terms of sectors, the study shows that eating out at a restaurant remains the most popular leisure activity in the UK and, despite gloomy news on the economic front, the proportion of the population eating out in the past six months has risen from 65% to 67%.

More relevantly, the report showed that the fast growing world of the social media is changing the patters of behaviour for many consumers.

For example, a third of us will consider a review of the restaurant on the internet as being important in choosing where we go and eat. Whilst it is mainly younger consumers who are driving this trend, it is expected that older professional workers will quickly catch up in using websites such as TripAdvisor.com, Yelp.com or the fast expanding Urbanspoon.com.

Given this, I was fascinated to have the opportunity to meet the owners of a new restaurant in Cardiff Bay that is not only setting the pace in terms of its location and quality of food, but has been pioneering in its approach to marketing the business through various social media.

Pier 64, based in Penarth Marina, is a joint collaboration between Francis Dupuy of Le Gallois fame, local developer Paul Smith, and Joanne Nuwar. Marketing itself as a good quality restaurant in a fabulous location, it has become the place to go out in within the immediate environs of the capital city.

A great deal of its success is of course due to Francis’s reputation in the restaurant trade and his skill at blending the best of French cooking with Welsh hospitality. The location overlooking Penarth Marina is also hard to beat. However, it has also taken full advantage, from day one, of the opportunities for the latest trends in social marketing for the restaurant industry.

In fact, unlike most restaurants in Wales, Pier64 is taking a completely new and creative approach to promoting itself that is paying dividends in a crowded marketplace.

Twitter, the social networking and microblogging service, has been critical in creating a buzz for the new restaurant, gathering nearly 500 followers in its first two weeks. Pier64 also monitors social media for people talking in advance about coming in for a special occasion such as a birthday or anniversary and then arranging for a free glass of bubbly on arrival. This approach all adds up to a great customer experience that can make the difference between people telling their friends and becoming a repeat customer.

A lot of direct customer interaction, including news and developments, will also be done via their new blog, although the use of such technology in the leisure sector is still considered unusual in the UK. In contrast, restaurants in the USA regularly uses the blogosphere, and the industry has a standard and accepted approach to social media that is proactive and valued by customers.

Of course, social networking is not without its dangers and opening up the whole area of social networking can be a risky business for a restaurant, especially one that is newly opened.

All of a sudden, rather than waiting for one food critic to visit the restaurant every six months, every customer with a mobile phone is potentially a reviewer sitting in the bar or the eating area and who can share it with tens of thousands in their own personal networks. Whilst worrying for some establishments, this approach can only help to raise the bar in terms of standards, thus benefiting the better restaurants which provide quality food and service at all times.

Another development that has benefited Pier 64 is the explosion in the applications (or apps) market. For example, it is one of only three Cardiff restaurants to feature in Jamie Oliver’s new “Foodie Guide to the UK”, a new iPhone app that is due out soon. This will enable the business to take full advantage of the growing army of smartphone users who access information on where to eat through their devices. Indeed, given that Jamie Oliver's last app became highest grossing paid for app on iTunes, its importance cannot be underestimated.

The opening a new restaurant like Pier 64 with excellent food in a great location is to be welcomed. However, the real winner here will be the rest of the industry in Wales which can learn vital lessons from this business, and others, on how social media benefit their sector in the long run.

Certainly, after a slow start, it is vital that Welsh businesses, in whatever industry they operate, to make the most of the opportunities presented by new technologies that are transforming the consumer experience for the better.