Using multiple business networks (co-ethnic, other ethnic and non-immigrant) in Australia: an approach in ethnic entrepreneurship networking

Based on evidence adduced from previous studies conducted in different countries and modifying the network framework for ethnic entrepreneurs developed by Menzies and colleagues (2000) for the Australian context, several research gaps were identified for the present study. These included the effect of personal networking attributes of the ethnic entrepreneur, his/her human and social capital and the host environment's parameters on utilizing the network functions inside or outside the ethnic entrepreneur's community in the Australian context, with a focus on the larger Melbourne area. It also included the level of trust in participating in a business network outside the ethnic community. Based on the identified gaps, the objectives of the current research were to explore the currently used and potential benefits of business networking across co-ethnic, other ethnic and non-immigrant communities in Melbourne, Australia; investigate the correlation of human capital of ethnic entrepreneurs and their tendencies to join networks outside their own communities, and examine the place of trust when ethnic entrepreneurs participated in networks outside their communities. According to Witt (2004), sociologists use and develop many quantitative measurements to explain a network's structure, players, and attributes such as 'density', 'connectedness', and 'diversity'; also, that networking 'must use quantitative measures to estimate information' (Witt 2004, p. 393). Some independent variables, such as 'network activities' which refers to time spent on networking and frequency of communication with actual and potential network partners are more suitably measured by quantitative methods. Therefore, the present research followed the quantitative approach and used questionnaires to find answers to set research questions that addressed the objectives. The survey questionnaire was administered in the larger Melbourne area among different ethnic/immigrant entrepreneurs to ascertain the characteristics of ethnic business networks as well as their relationships with Australian business associations and government bodies. The survey targeted a variety of ethnic businesses, mainly small, within the service sector. In total, 130 completed questionnaires were collected after eleven months of intensive data collection. Of the three types of business networks studied, the co-ethnic network had momentous roles in the ethnic entrepreneurship process. It facilitated the processes of hiring coethnic employees (through the social network), generating demand for ethnic-based commodities or services (mainly in ethnic ghettoes) and supplying those goods and services (through connections to the ethnic origin sources). The co-ethnic community/network provided information to ethnic business owners when they faced problems. It was also deemed to be a rich source of role models and mentors (or 'old brothers', a term used by Anna Lee Saxenian (2006)) which, together with family and friends, formed sources of emotional support for ethnic entrepreneurs. In terms of finance, the participants used all available options within the three types of networks. The participants preferred non-immigrant networks (Australian bodies) for potential benefits such as 'solicitor support', 'arranging meetings with different groups', 'training courses' and 'protection from social threats'. The level of awareness of availability of those potential benefits from other ethnic communities or networks was the lowest compared with co-ethnic community/network and non-immigrant (Australian) networks. Mutual trust appeared to be the catalyst that assisted not only coethnic communications and relationships in business activities, but also communication in other networks as well. One implication was that government bodies and non-immigrant business groups should assist ethnic entrepreneurs in developing their business plans, as the importance of having a good business plan was recognized by the participants. Another was that, since ethnic business owners preferred them as sources of loans, banks should be pro-active in supporting ethnic businesses. It was also implied that non-immigrant and government bodies should be more active in providing relevant information to ethnic business owners as well as inviting ethnic entrepreneurs to engage with them and, since multiple business networks have the propensity to provide multiple benefits/support, ways to make those available to ethnic entrepreneurs need to be investigated.