‘Business is Boring’ is a weekly podcast series presented by The Spinoff in association with Callaghan Innovation. Host Simon Pound speaks with innovators and commentators focused on the future of New Zealand, with the interview available as both audio and a transcribed excerpt.
Today we’re joined by a great chap; he’s one half of Tommy & James, the pair famous for the Nice Blocks iceblocks and Little Island Coconut Creamery range of cocconut milk. Our guest James Crow is a pioneer in Fairtrade, natural goodness, good business practice and is now a growing exporter making good things with good people and taking it to the world.
Either download or have a listen below, subscribe through iTunes or read on for a transcribed excerpt.
You guys have been in the media for being living wage employers and for paying above the standard rates. Tell me about the thought there and has that also helped grow the category? Are you seeing other businesses pick that up?
What I always hoped we would see is people would factor that into their initial business plan, if they have one. Because we certainly didn’t have a business plan. What we did know was that we weren’t going to pay anyone to do what we were doing less than $20 [an hour], ironically that’s still not quite living wage, I think it’s $19.85 or something. We wouldn’t pay someone else to juice oranges for less than $20. The first guy we got on board was in a band at night. So if we’re gonna get him up to come work for us in the day, we’re gonna pay you $20 an hour. Any less and we’d feel bad. So we applied that same ethic to everyone else. We’d feel bad if you worked all night for us for less, or for no overtime. And it made us feel good and it made our other directors who aren’t in the business all the time go ‘do you guys still feel good about the way you’re growing?’ If we said ‘no, we feel terrible because we’re paying them minimum wage and they don’t wanna look us in the eye and we can’t ask them to do any more.’
We abide by a totally separated system of pay rates which we don’t control. That makes them feel quite safe being with us. I’m quite confident in saying that it’ll go up every year. And I’m quite happy to see it go up a dollar each year. That would petrify a lot of well established companies to think they might have another hundred grand total on their employee bill next year. But you’ve trained those people more, they know more, why would you risk losing them for $100,000 on a 20 million dollar business?
Those are the businesses who fight the living wage because they do have 20 million dollar businesses with the largest cost being low skill labour.
Then they risk it all and when they lose a whole lot of their capacity and value in employees, they’ll spend far more money trying to bring in new consultants, new people to manage the same team. It’s spending money where they always think is wise, which is after the fact or during an emergency. It seems strange that we’re being a much more responsible, mature business when we’re far more immature in every other way.
How does paying more to your staff turn into more on your bottom line? Does it do that for you?
Number one is that people like to brag about that sort of thing. I buy products that pay their workers more than I do. We still work hard and we still have to pay all of our other bills and we still run long on our accounts, but people go ‘well at least those bastards are still paying us slow but damn do they do good things by everything else in the community’. Whereas we could just be absolute a-holes and then still not pay our bills. Because every business that’s growing fast can never keep up with its cash needs. At least you can say ‘well we are really nice guys and we’re the place you’d like to send your child to work in the school holidays’.