Lord Young, one of the Prime Minister’s key advisers, has compiled a report into the state of start up businesses in the UK and where he believes the Government can help.
As it stands, there is finance available in the way of Government funding for start up business, but several factors are halting its path to market.
With the qualifying age for the funding upped to thirty in January, the Business Link website abandoned and a lack of marketing, not only do new enterprises not know how to access the money set aside to encourage their growth, they don’t even know it’s there.
Start-Up loan scheme has lent £16m to date
In September 2012, the Start Up Loan Scheme was launched as a way to help new enterprises get a leg up onto the business ladder. To date, £16M has been loaned to fledgling business.
To help those businesses embed and eventually climb the rungs, access to mentoring and support was also made available.
This advice was crucial as the age limit availed of the finance was 18-24; that was until the beginning of this year when that age cap was raised to 30.
In Lord Young’s recommendations, he suggests that the age cap of thirty is not only unnecessary, but should be removed altogether.
Lord Young calls for abolition of certain public sector pre-qualifying questionnaires
Another barrier to business Lord Young would like to see fall is the necessity to complete pre-qualification questionnaires for public sector contracts that are less than €200,000.
In addition, the PM’s adviser would like to see a single market created specifically for public sector business, estimated in the report to be worth around £230bn.
One of the key areas Start Ups struggle with is getting the word out about the new product or service they offer.
Lord Young has identified that online marketing will be key to growth for many new businesses. Using social for business is not the same as logging onto facebook to check your notifications and post the odd status update.
A successful online marketing campaign is strategic, requires expert knowledge across multiple platforms and a special talent for engaging potential customers.
As start ups have enough to focus on setting up shot and familiarising themselves with the market and production, Lord Young has suggested a Growth Voucher to the tune of £30M to help businesses market online and offline to extend their reach.
SME growth should focus on local as well as online
Conversely, Lord Young also recognises the need to remain local as well as look to grow globally online.
In order to remain in touch with the locale, he suggests business schools be incentivised to interact with those on their doorstep.
This way, SMEs would grow organically and naturally in line with a theoretical Supporting Small Business Charter.
The Business Link website was a useful facility for many individuals looking into going it alone. Since its demise, the site has sat idle and will, no doubt, soon become dated.
Rather than see the facility go to waste, Lord Young suggests bringing in third party contributors to update and maintain the information as a resource for those start ups who would similarly find it useful today and in the future.
Spokesperson for the Confederation of British Industry, Hayley Conboy, reiterated Lord Young’s findings that start ups simply don’t know that the money has been set aside for them as potential loans to help them kickstart their enterprise.
Don’t know about you, but someone offering a service that no one knows about yet purports to be a help to marketing is a little like the blind leading the blind, but it seems to have everyone’s support.
Conboy also seconded Lord Young’s proposal to do away with the pre-qualifying questionnaire for lower value public sector contracts.
SMEs have not had the time to grow to be able to accommodate such lengthy documents and would be able to bid on public sector business they currently feel is unattainable.
Have Your Say:
- How would you like to see the Government contribute to Small Business growth?
- Is it something you’ve considered or perhaps would do if the funding was available to get your start up off the ground?
