Minister urges banks to help small businesses scale up and grow
Britain has seen a surge in the number of new businesses being created each year, according to the latest government figures.
There are now a record 5.5 million private sector firms – a million more than seven years ago.
The Minister for Small Business, Margot James, welcomed the figures, saying: “Small businesses employ 12.5 million people – 48% of the total UK private sector.
“They boast a combined annual turnover of £1.3 trillion – 33% of all private sector turnover.”
Ms James said the government wants to encourage even more start-up businesses and help them to grow. Speaking at a banking conference, she urged banks and the finance sector to work harder to help new enterprises get the capital they need to succeed.
She said: “If we look at equity finance for example, there is a huge disparity between the ‘golden triangle’ of London, Oxford and Cambridge and the rest of the country. I would urge all of you to increase collaboration at the local level.
“It is easy for us to forget just how focused business owners are on running the business from day to day. But it’s essential that knowledge is shared.”
So far, there seems to be little slow down in the number of people wanting to start a new business and then scale up and grow.
However, while creating and developing a business can be an exciting, it’s vital to carry out extensive research to make sure you can progress in a sustainable way. This is especially true if you need to apply for finance. You need to know your potential market but you also need to consider the legal structure of your business.
For example, you may start out as a sole trader but as you develop there might be advantages in creating a limited company or perhaps entering into a partnership.
The correct approach will depend on the type of business you operate. You may also need to consider employment contracts if you need to take on staff, and leasing arrangements if you need premises.
Good legal advice at the outset can prevent mistakes that could prove costly in the future.
Please contact Sing Li if you would like more information about the issues raised in this article or any aspect of starting a new business.