A Closer Look
We are not a fan of focusing on deficits as it fails to recognise the strengths of the community. However, in order to understand our logic for developing Welcome to Country it is important to provide the larger context.
Thriving economies to economic exclusion
Prior to the arrival of Europeans in Australia, Aboriginal people had healthy, thriving communities involved in economic activities, including mining (extracting green stone for stone axe heads from Mount William quarry) and large-scale aquaculture and eel farming. While the language and currencies were different, the concept of working in a successful economy was common across different communities.
Even after the first arrivals of Europeans, Aboriginal people continued to engage and work in their economies. The highly successful hops farming at Healesville by the Aboriginal community at Corranderk was a good example of this.
But over a notorious history Aboriginal people were systematically excluded from participating in economic life. This has had a devastating effect on the Aboriginal community and must be addressed if Aboriginal people are to have a successful economic future.
In more than four decades since the 1967 Referendum, Australian governments have developed and funded policies and programs to improve the socio-economic status of Aboriginal and Torres Strait Islander peoples and overcome a long history of poverty and marginalisation. Progress has been made.
Yet in 2009, despite the formal recognition of equality so many years ago, Aboriginal and Torres Strait Islander people remain among the most disadvantaged Australians. Many simply do not have the opportunities afforded to their fellow Australians, and many are not able to participate fully in national life
Economic equality is part of the solution
Reconciliation Australia commissioned Deloitte Access Economics to undertake an analysis of the impact on the Australian economy if in 2031 the gap in social and economic outcomes between Aboriginal and Torres Strait Islander peoples and other Australians was closed.
They sought to assess the economic impact of ‘closing the gap’ between Aboriginal and Torres Strait Islander people and non-Indigenous Australians in life expectancy, education and employment outcomes.
The research showed that, if the gap between Aboriginal and Torres Strait Islander peoples and that of the broader community could be closed, it will increase the Australian GDP by $24 billion.
Further, research shows that by increasing an individual and family’s income is one of the major social determinants that address many other social outcomes.
Theory of Change
To help understand the social impact and the links between the activities of Welcome to Country and the impact we seek to have, a theory of change has been adopted. Jobs are a lead indicator for a number of social and economic outcomes.
A typical approach to understanding the impact of an investment decision is to undertake a detailed cost benefit analysis (CBA). A CBA is always comparative to a base case which may be the continuation of the status quo. The challenge is that the base case will vary significantly across the country, thus requiring a location by location analysis. Another widely used approach is a variation of CBA called Social Return on Investment, which seeks to understand the full social impact of an organisation or project. It faces similar challenges to CBA and it also requires the adoption of financial proxies for social outcomes.
Given these challenges, job creation has been identified as the key outcome, as it is seen as a key contributor to other social and economic indicators.
Job creation for this project is created in four ways:
- Staff employed directly by Welcome to Country including contractors
- Procurement spend by Welcome to Country
- Revenue generated for the Aboriginal and Torres Strait Islander businesses
- Number of people employed as a consequence of the earned income
It is our plan to publish regular updates on our progress against these indicators so that we are transparent on our impact.
Welcome to Country’s Role
Core to the delivery of our social purpose is three distinct areas of activity. The first, and what is considered the central enabler to achieve our purpose, is the creation of an online marketplace to facilitate sales of tours and experiences. The second, is to provide support services to entrepreneurs and businesses to enable them to thrive. The final part is exploring ways to bring capital funds into the sector to support start up and growth of businesses.
As a new organisation, Welcome to Country has determined that it will initially focus on the marketplace. The other areas remain priorities and will be added as we grow and find additional support.
However, we have also started to focus on establishment of new experiences by working with existing and new operators to create new experiences. This delivers on our core purpose of creating jobs and businesses whilst addressing the need for the volume of product on the marketplace.
Why a marketplace?
In 2013, Indigenous Business Australia produced a report on Indigenous tourism in conjunction with Griffith University and Queensland University. The report showed that both supply and demand for Indigenous tourism experiences existed, however there was no point of connection. There has been no substantive change since this report was produced.
Central to creating jobs and economic outcome for communities is connecting communities with people who would like to purchase their experiences. If we are unable to do this as a fundamental, then we will not succeed on our vision and purpose.
Our research demonstrated that there is demand for Aboriginal and Torres Strait Islander experiences. There is a growing desire from travellers to connect with experiences that also provide a bigger social impact. No-one was addressing this need.
Additionally, much of the product on offer in other tourism marketplaces was often operated and delivered by non-Aboriginal people and businesses.
A big consideration for us in setting up the marketplace, was how do we make the marketplace sustainable? Whilst Welcome to Country enjoys considerable philanthropic support, how do we ensure that we survive if we were to lose this support?
In determining sustainability, there are some key considerations, what level of commissions would we charge on sales, how much product and what level of sales would be required, and finally who would be able to list.
In seeking answers to these questions, we looked across the industry to understand what standards in the industry and we balanced these against our purpose and vision.
In relation to commission rates, our research showed that there was a lot a variation on commission rates with up to 40 per cent charged by marketplaces with high volumes of traffic – and this did not include any dedicated effort to promote and market Aboriginal and Torres Strait Islander experiences. We have landed on a commission rate that is substantially lower than this and maximises the return to operators.
In order for a marketplace as a whole to be sustainable, clearly having sufficient experiences in enough locations so as to appeal to the greatest possible numbers is important. The platform would not work if there was only a handful of experiences. The volume of experience sales required would not be sustainable and ultimately lead to a negative impact on communities. Welcome to Country also sees that it has a role in working with individuals and communities who would like to get into tourism and help them in developing experiences for the market.
In examining current offerings, we noticed three types of offerings, business owned and operated by Aboriginal and Torres Islander people, non-Aboriginal owned businesses but Aboriginal and Torres Strait Islander led experiences and finally non-Aboriginal owned and led experiences.
Given our purpose and vision, the first two business types align. The last business type does not align and so is excluded from being listed on the marketplace.