SMEs

The matter of how sustainable a potential supplier, stakeholder or partner is, is a priority for as many as nine in 10 small businesses, according to new research.

Polling a sample of more than 1,000 small business leaders, the results showed that 89% said they would check the sustainability credentials of a company in some way before deciding to work with them.

As sustainability issues become increasingly important, both the desire to work with green suppliers and scepticism of bold green claims are on the rise. Recent research found as many 76% small business said they intended to ‘green’ their supply chain last year, while the Competition and Markets Authority (CMA)* and Financial Conduct Authority (FCA)† have both introduced new measures to ensure green claims made by companies do not mislead.

58% would seek out official certifications, accreditation and listings

The results showed that almost half of small business leaders would actively check for an official certification that recognises the organisation as meeting certain sustainability standards. Additionally, around a third would check an organisation’s listing as a sustainable business on groups such as the Federation of Small Businesses or British Chambers of Commerce.

Interestingly, it was leaders of larger businesses (up to 250 employees) that were more likely to seek out official accreditation (64% vs 53% of businesses with fewer than 100 employees).

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Examining a company’s claims

A company’s own published materials were also a consideration highlighted by the survey. Around a third (34%) said they would research the company’s green policies and practices on its website, with an additional 31% saying they would check reports and mission statements that outline green objectives.

More directly, just over a quarter (28%) said they would ask representatives about the company’s attitude towards sustainability as part of the process to decide whether or not to work with them.

Broader reputation a significant factor

Around a third (35%) said that they would do a cursory search on the company both on the Internet and on social media to check what others had said about their sustainability credentials. Additionally, around one in five (22%) said they would ask close contacts of the company to get a sense of a partner’s reputation as a sustainable company.

Jo Morris, Head of Marketing and Insight at Novuna Business Finance commented:

“We are quickly reaching the point where many small businesses will seek out greener options if it falls within the bracket of what they consider to be affordable. This wave of interest is met with an ever increasing range of options to choose from. This means that business leaders are now forced to apply an additional layer of rigour to sort the genuine from the “too good to be true”. What we see from this research is not only the desire to work with green suppliers and stakeholders as part of their day-to-day operations, but also the extent to which they are prepared to check any claims.

“The new measures that are being introduced by the likes of the CMA and FCA will give small business leaders more confidence in the decisions that they make, however the importance of a business carrying out its own research cannot be overstated. Understanding the right questions to ask, and where to find this information, is a key part in the process to making good sustainable choices for a business.”

Source: Business News Wales

According to a recent poll of 500 small business owners and sole traders in the UK, nearly 77% of them believe that starting their own business was one of the best decisions they ever made.

Furthermore, 2/3 of respondents feel optimistic about the future of their ventures, despite the ongoing economic uncertainty caused by the cost-of-living crisis.

A significant 21% of the surveyed SME owners and sole traders are looking forward to welcoming back clients over the next 12 months as the economy stabilises.

Additionally, 19% feel optimistic about the opportunity to acquire new clients, while 20% are looking to introduce new products and services.

The research also found that almost 58% of small business owners have achieved the main business goal they set for themselves.

The most important personality traits for success in the business world were found to be hard work (48%), motivation (44%), and organization (42%).

Sarah Berry, a career expert who has analysed the personality traits of successful business owners for over 30 years, said that sales skills, a sense of purpose, and a willingness to take action are also key.

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Other important characteristics include resilience, adaptability, and flexibility.

AXA UK commissioned the research to mark the launch of its Startup Angel Competition, which is supporting small businesses by giving them the chance to win £25,000 worth of funding along with mentoring.

The survey also revealed that 27% of SME owners and sole traders have a million-pound business idea, but don’t know how to make it a reality.

Among them, 88% said that the idea is related to the industry they are working in.

While 35% of SME owners say that they don’t regret not starting their businesses any earlier, inflation (31%), increasing fuel and energy costs (24%), and the rising cost of materials (20%) are the biggest challenges they face.

Business owners have additional personal savings (43%), savings from their business (37%), and business insurance (30%) as the top safeguarding measures against these challenges.

Commentary:

The findings of this survey indicate that small business owners in the UK remain optimistic despite economic uncertainty.

The results also highlight the importance of hard work, motivation, and organization for success in the business world.

The Startup Angel Competition, launched by AXA UK, is a great initiative that will support small businesses and promote their growth.

The fact that a significant number of SME owners and sole traders have a million-pound business idea but do not know how to make it a reality indicates the need for more support and mentoring programmes.

By Joseph Benjamin

Source: TDPel Media

Business owners have been selling their firms – but total sales figures are down significantly compared to previous years.

UK entrepreneurs have made £11.8bn selling their firms in the past year, according to research by Bowmore Asset Management.

That was 59 per cent lower than the £29.1bn that businesses made in 2019/20. This was partly because of the early stages of the Covid-19 pandemic causing a slump in merger and acquisitions activity. The economic slowdown during the pandemic also meant that entrepreneurs were more reluctant to sell at reduced valuations. Prospective buyers were deterred from buying UK businesses in the first six months of the pandemic because of the uncertainty around its economic effects. Social distancing rules also made it more difficult to carry out due diligence checks, which are essential to the mergers and acquisitions process.

Mark Incledon, chief executive officer of Bowmore Asset Management, said: “British entrepreneurs have had another good year for selling businesses, with billions of pounds more brought in.”

“Even during the extremely challenging economic conditions of the pandemic, UK entrepreneurs were able to generate significant amounts of money by exiting their businesses.”

Incledon advises entrepreneurs who have sold their businesses recently that they should be looking to invest these profits and maximise future returns.

He added: “The first order of business for entrepreneurs who have sold their companies should be reinvesting that money sensibly. Yields are now more generous, but inflation is eating away the value of savings at a far faster rate than normal.

“However, valuations are depressed across a wide range of asset classes and those who invest wisely today stand a good chance of benefitting in the long term.”

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What is Business Asset Disposal Relief?

Bowmore Asset Management’s research is based on HMRC’s Business Asset Disposal Relief figures. It was known as Entrepreneurs’ Relief before April 6, 2020. It means that you may be able to pay less Capital Gains Tax when you sell all or part of your business – 10 per cent rather than 20 per cent. It covers the sale of a business or qualifying shares for up to a lifetime value of £1m (it was £10m under Entrepreneurs’ Relief).

To be eligible, you must be able to satisfy the following two criteria for at least two years up to the date of selling your business:

• You’re a sole trader or business partner
• You’ve owned the business for at least two years

By Anna Jordan

Source: Small Business

Over half of UK SMEs (54%) have experienced some form of cyber-attack in the last year a new report by Vodafone Business has found.

The research, which is published today in a new report from Vodafone ‘The Business of Cybersecurity’, polled over 500 small and medium business owners across the UK and found that more than half (54%) had experienced some form of cyber-attack in the previous 12 months. This is an increase of 15% when compared to similar research conducted by Vodafone two years earlier which found 39% of SMEs had experienced some form of cyber-attack.

The findings point to a rising risk for SMEs to stay safe online, especially with more people working remotely and many businesses reliant on digital technology.

Vodafone’s study also found that one third (33%) of SMEs had seen the number of attempted cyber-attacks against their business increase, whilst just 18% had seen the number go down. About one in five (19%) SMEs said that an average cyber-attack could cost their business up to £4,200, a loss they would be unlikely to bounce back from in the current cost-of-living crisis.

The rise in online attacks comes as ONS (Office for National Statistics) data indicates that more than a third of businesses in the UK now use a hybrid working model. The National Cyber Strategy 2022 has also stated that a growing dependence on digital technologies for remote working and online transactions has “increased exposure to risks”.

Since Vodafone last examined the cybersecurity risks facing SMEs in 2020, the invasion of Ukraine and continuing geopolitical tensions have had an adverse effect on the cybersecurity landscape, prompting the National Cyber Security Centre (NCSC) to warn that: “now is not the time for complacency.”

Despite this, 18% of SMEs polled by Vodafone said their business was not protected with cybersecurity software whilst 5% did not know if they had protection and only 28% were aware of the Government’s Cyber Essentials scheme. The findings echo previous findings Vodafone, such as in last year’s SMEs Like Me report which revealed only 8% of SME business leaders saw cybersecurity as a priority.

To ensure that more SMEs are protected from online attacks, Vodafone is calling on the Government to do more to raise awareness of current initiatives to support the delivery of local cyber security skills. This should include providing the required funding to run a targeted ‘Cyber Safe’ awareness campaign for SMEs.

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Andrew Stevens, Vodafone UK Head of Small and Medium Business said: “Last year we outlined the significant and detrimental impact of a cyber-attack on a small business, to the tune of up to £3,230 per attack. This figure has now subsequently risen to £4,200, which is a consequence from which most SMEs would not recover.

“These findings reflect a lack of adequate skills and information to equip small business owners with sufficient protections and whilst we welcome the progress that has been made by Government with the establishment of nine regional Cyber Resilience Centres across England and Wales, it’s clear that more needs to be done to support SMEs with their cybersecurity and help them protect their business online, especially during a cost-of-living crisis where they are most vulnerable.

Tina McKenzie, Policy Chair of the Federation of Small Businesses (FSB) said: “The digital economy presents a huge opportunity for small firms to reach new markets and customers, but these benefits come with challenges. This report sheds light on how vulnerable small firms become targets of criminals in the cyber space, when they’re often less able to absorb the cost of crime.

“We’re pleased to see a recommendation to raise awareness on cyber resilience among the small business community through relevant Government campaigns included as part of this research.

“We encourage internet service providers to take on more responsibility for cybersecurity, along with software vendors, hardware developers, the banks and other financial intermediaries – they’re the best placed and have the resources to implement the most effective measures.”

By Eva Dixon

Source: Verge

Four fifths (81 per cent) of business owners are worried about recession, with small business confidence taking a hit as the nation’s 5.5 million small firms face an array of challenges heading into 2023. A new report from Small Business Britain and TSB Bank has found that concerns about the economy is deterring small businesses from investing in growth, innovation and hiring new talent. However, the report also points to many sources of business opportunity and a determined fight back from the nation’s small business community, with over half of small businesses (52%) signalling that they are experiencing challenges, but pressing on anyway.

The report, which looks at how small businesses can return to growth, underlines the grit and resilience that now characterises Britain’s small business community, as they deal with perpetual change following the pandemic and cost of living crisis.

Over a fifth of small businesses (22%) say Brexit has impacted their business negatively, and 29% of firms have reduced operational spend to respond to difficult conditions. However half have continued to adapt by adding on new revenue streams.

“Small businesses continue to face hugely turbulent times, and many are exhausted from dealing with constant challenges,” said Michelle Ovens CBE, founder of Small Business Britain. “While the prospect of recession is causing much anxiety, there is still a lot of opportunity for small businesses in the UK to drive economic recovery and we need to help them grow in confidence and optimism with tools to help them focus on growth and success.

“Waiting for the ideal market conditions is broadly futile in a world that keeps changing as we have seen over the last three years. Businesses need a model for operating that can survive and thrive during turbulent times.”

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Small Business Britain has launched a guide to help businesses grow during a recession, with identifying new routes to market and focusing on export opportunities identified as key tactics for small businesses to cope with a flat UK market.

“Growing a niche food product during an economic downturn is challenging, as consumers can be cautious with their spending and less likely to try new or specialty items,” said Delight Mapasure, founder of K’s Wors, a South African speciality sausage producer. “This has led us to focus on exploring new opportunities via export markets and we have entered the Middle East and have talks at an advanced stage with India. Being able to reach new customers is vital for us, and other small businesses, to develop, reduce risk and have greater resilience.”

Focusing on digital skills is also highlighted as a priority for growth. The report found that 52 per cent of small businesses have not sharpened technology skills in the last year, and 64 per cent have not been investing in technology tools.

Adeel Hyder, Business Banking Director at TSB Bank said: “There’s no getting away from the fact that the last few years have been tough for many small businesses. The next twelve months will bring further challenges as costs continue to make an impact, and a potential economic downturn is forecast. Despite this, I believe there are many reasons to face the future with optimism.

“It is very often small businesses that lead the way out of a recession, and there are good reasons for that. Small businesses tend to have closer relationships with their customers and partly because of that, they are often better placed to anticipate and adapt to changing needs in the economy. It is clear from the experience of the last few years, that challenges can very often be accompanied by fresh opportunities”.

Source: SME WEB

Separating your business from the pack is key to success in any industry. How do you make sure your business stands out from the rest? Superb service and product quality are critical, but how your business is marketed and perceived will also decide your success and growth. With that in mind, let’s look at our five tips for helping your business stand out in a crowd of competitors.

Tip 1: Establish Your Selling Point
What actually makes your business special? Why should a consumer choose you over a competitor?

Having an answer to these questions will determine your business’ selling point and is the steppingstone towards proving your ‘why’ to consumers. Establishing this early on is paramount or your confidence as a business owner will be lacklustre.

After your selling point is cemented the next challenge smaller businesses often face is gathering the team to support these operations. This can be mitigated through virtual office providers such as Servcorp which offer businesses a fully trained support team. As a small business, having your own receptionist, secretarial assistance and I.T support without needing to undergo the hiring and training process is a large cost plus time saver – after all, your time is money.

Businesses also receive this staff support at the fraction of the cost they would otherwise be paying.

Tip 2: Present a professional working environment

Many businesses find it challenging to create a professional working environment to impress their clients, especially for newer companies competing in major global markets on a limited budget. Traditional office spaces require long and costly leases, with break-out clauses only every few years, if at all.

A more convenient and cost-effective solution is a serviced office. These can be rented at a far less cost than a traditional office, whilst still being located in major business hubs like London and New York. Moreover, customers will enter an unbranded reception area allowing businesses to imply that they control the entire floor.

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Tip 3: It’s all about Marketing
Your product may be superior to competitors, but it will all be meaningless without adroit messaging and unique marketing. Your business is likely to have thousands of competitors, which is why the first step is to complete a competition analysis.

Comprehensively understanding what your competitors do well, recognising trends and identifying where others are failing will provide your business the strategic insight needed. From this your business will have a decisive direction on its marketing goals, however finding new methods to secure a commercial advantage will accelerate your point of difference.

For example, using a virtual office can provide an established look for smaller businesses based in the UK. With a virtual office your company can legally register its business address as the virtual office’s address.

Tip 4: Always provide excellent customer service
Customers expect and deserve excellent service when dealing with you. Make sure you have processes to deliver the highest quality customer service and ensure that all your staff are trained to meet these expectations.

Whether it’s the front desk staff, your Customer Service team, or a manager calling back, providing the best care for your client will help retain them over the long term. Even an unhappy customer can be won back if the service they receive after a problem is effective and genuine.

Tip 5: Network!
Get discovered by networking. There are many ways to find networking opportunities. Meetup groups, seminars, conferences, and industry events are great ways to meet like-minded people. This an opportunity to make business partners and scope out your competition at the same time.

And don’t forget the power of social media – there’s an app for almost anything these days!

By creating meaningful relationships in your industry, you can leverage audiences and gain exposure for your business. It’s also worth noting that all Servcorp’s serviced and virtual office customers gain access to Servcorp’s online networking community of 50,000+ global businesses and networking events, providing them with a significant additional value from their small investment.

Source: Real Business

The “SMBs Driving Economic Recovery” report from Sage today reveals that, despite ongoing economic turbulence, growth in turnover for UK SMEs is expected to outperform the growth rate for all businesses from 2023-2025.

SMEs are expected to make up 51.9 per cent of total business turnover in the UK economy by 2025. The report, which assesses data in the period from 2005 to 2021, including the impacts of the Global Financial Crisis, then forecasts growth trends over the next three years.

Analysis predicts that the number of UK SMEs is expected to rise by 342,000 from 2022 to 2025, while emphasising the importance of SMEs across all regions in the UK. In 2022, London generated £662bn worth of SME turnover, while in the North East, SMEs employed 67 per cent of all business employees in the region.

Historical market analysis by Cebr also underlines the vital role of SMEs in the recovery from the 2007 to 2009 Global Financial Crisis and projects a similar pattern when we emerge from current economic challenges. In the UK, the number of SMEs grew by 12 per cent between 2013 and 2015, well exceeding pre-crisis levels.

The data also found that 13 per cent and 10 per cent of all new businesses were born during 2008 and 2009, respectively, showing that entrepreneurs were not fazed by the downturn.

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Derk Bleeker, president EMEA at Sage, commented: “SMBs shouldn’t be underestimated in helping to recover and drive the economy as we head into the next few years. They make up 99.9 per cent of all businesses and generated more than half (51.1 per cent) of UK business turnover in 2022.

“So, while business owners are facing real challenges, they are clearly in a better position to adapt to changing economic landscapes and have the resilience to ride the storm.

“Our ask of the government is simple; make it as easy as possible for SMBs to do business digitally and adopt technology that will unlock productivity and give them the insights to adapt and grow quicker.

“With the right support, policies and incentives in place, SMBs will unleash their full potential and play a vital role in economic recovery and sustained long term growth.”

By Matthew Neville

Source: Bdaily News