The new face of Canadian business
Aboriginal entrepreneurs are growing in number and moving beyond their roots
Mary Teresa Bitti
Financial Post
May 2, 2005
CREDIT: Wayne Cuddington, CanWest News Service
There are huge barriers for Aboriginal firms, says John Bernard,
founder of Donna Cona Inc., Canada's largest Aboriginal-owned technology
firm.
The year 2017 has demographers, economists and big business abuzz. That's when visible minorities will become the majority in Canada. Consider the statistics: The aboriginal birth rate is already 1.5 times that of non-aboriginals, while 300,000 new immigrants enter Canada each year. The population landscape is changing -- fast -- and so is the face of business.
"We are at a critical point," says Orrin Benn, president of the newly formed Canadian Aboriginal and Minority Supplier Council (CAMSC). "If we don't help these entrepreneurs succeed in growing their businesses, then Canada loses."
It is no secret that small business is a key driver of the country's economy. Small businesses -- those with fewer than 50 employees -- account for 24% of Canada's GDP. And nearly 85% of Canadian exporters are small businesses. Less known is the role visible minorities have played in the country's economic well-being. Since 1996, the number of self-employed aboriginal Canadians has risen by more than 30% -- nine times higher than among self-employed Canadians overall.
Traditionally, aboriginal entrepreneurs have focused on connections to their land and heritage, either in primary industries such as fishing and forestry, or in culture, tourism and the arts.
Today, aboriginal entrepreneurs are looking beyond businesses with traditional roots. The number of aboriginal businesses operating in professional, scientific and technical, education, health, and social services more than doubled from 1996 to 2001, and the number of aboriginal manufacturing, transportation and warehousing businesses was five times higher.
At the same time, visible minorities own 7% of all Canadian small and medium-size businesses. Those businesses tend to be larger than average and are more likely to export goods and services. Small wonder, then, economists are urging governments and industry to do more to encourage these companies.
Enter CAMSC. "It's our job to give these entrepreneurs access to corporate suppliers," Mr. Benn says. "If we are able to grow a small business to the critical mass you need to compete globally, then everyone wins. If we don't, we all lose."
CAMSC, which is modelled after the National Minority Supplier Development Council (NMSDC) in the United States, recently hosted its first procurement fair, bringing aboriginal and visible minority entrepreneurs together with such marquee corporate players as the Royal Bank, Xerox, IBM, Hewlett-Packard, Coca Cola, Pepsi Cola, Daimler Chrysler, Office Depot, Bell Canada and Cisco Systems.
The goal is to become as strong a catalyst for change in the marketplace here as the NMSDC is in the U.S. In 2002 alone, NBSDC's 3,600 corporate members purchased US$72-billion worth of goods and services from some 16,000 NMSDC-certified minority suppliers.
To qualify as a member of CAMSC, companies undergo an audit that includes a review of their papers of incorporation and meetings with senior executives.
John Bernard, president and founder of Donna Cona Inc., Canada's largest aboriginal-owned technology firm, has high hopes for CAMSC. "This will help level the playing field."
In addition to dealing with the many challenges that face any small business owner, Mr. Bernard has experienced first hand the unique challenges facing aboriginal and minority entrepreneurs. "I would like to be able to say there is no difference, but I can't. Gaining access to the supply chains of major corporations is a huge barrier to break through for any entrepreneur, particularly since many of these corporations have longstanding relationships with their suppliers. Still, gaining access is that much harder if you are aboriginal."
Before he launched Donna Cona, Mr. Bernard owned a non-aboriginal firm -- Systems Interface Inc. -- and made a point of taking advantage of every program available to small business owners. When he formed Donna Cona, an aboriginal firm with more than 51% aboriginal ownership, he decided to make use of the niche programs offered to aboriginals.
"These were the same types of programs, all
geared to helping get small businesses off the ground, and yet they
were referred to as handouts," Mr. Bernard says. "I can't
tell you how many times I heard, 'You aboriginal people are lucky,
you have all these handouts.' When I went after the same subsidies
for Systems Interface, they were never called handouts."
The stereotypes didn't stop there. Six months after beating out
IBM and CGI to design the infrastructure for Nunavut residents to
communicate across the two-million-square-kilometre expanse of Canada's
largest territory, Mr. Bernard learned the fact he was aboriginal
could have cost him the contract.
"I was at an event with the CIO of the Nunavut project and he asked if I was aboriginal. I said, 'Yes, isn't that one of the reasons we won.' And he said, 'Oh God, no. You won because you had the best proposal. 'In fact,' he said, 'if we had known you were aboriginal that would have gone against you.' Why? Because of the stereotype aboriginal firms do not deliver. If an aboriginal company makes a mistake, it reflects on the entire community. That is a huge obstacle to overcome."
CAMSC offers aboriginal and minority entrepreneurs the opportunity to enter mainstream business in a way they have never been afforded. It also gives Canada the opportunity to play catch-up with the United States and improve its competitiveness.
"Our ultimate goal is a win-win-win situation,"
Mr. Benn says. "The supplier business wins because it now has
access and through that access it can grow. Major corporations win
because when they find a new supplier they gain choice, innovation,
competitiveness and market knowledge. Most of all, Canada wins because
it boosts our level of trade and competitiveness. Our success spells
success for everyone."
GETTING STARTED:
If you are thinking about launching your own small business, these
sites have help:
- http://businessgateway.ca
- www.cbsc.org
- http://strategis.ic.gc.ca
© National Post 2005