As one of its backers, Sir Richard Branson, says “SMEs provide nearly 60% of all private sector jobs, and nearly 50% of private sector GVA. StartUp Britain is designed to make it easier for new companies and innovations to flourish and encourage people who aspire to start new businesses to work for themselves.”
The launch dovetails with the Government’s announcement of a raft of measures aimed at encouraging young people to start businesses. These include the creation of enterprise societies in every university and a major roll-out of Tenner Tycoon, the competition owned and run by the Peter Jones Foundation. Part of the initiative is to introduce a Mentor Marketplace to help start-ups find tailored advice and support.
It is hoped that the move will give young people the opportunity to learn how to run their own show, inspiring the next generation to seriously think about starting their own company. Business secretary Vince Cable says, “We want to transform the ambition and aspiration of young people through real business experience.”
At a time when youth unemployment is at an all-time high, with more than one in five 16 to 24 year olds being out of work, this initiative should be broadly welcomed. However, only time will tell whether the StartUp Britain scheme – a start up business in itself - goes the way of the four out of five new businesses which fail.
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( 3 / 247 )All businesses want to build their brand – to formally announce what it is that they do or make and what they stand for. But how they communicate that message has changed dramatically over the years. Whereas, apart from face to face selling, adverts in newspapers or leaflets and brochures used to be the only way that small businesses could communicate with a wider audience, these days every small business has at least a website. Many companies also now tweet and blog and, increasingly, they advertise on the worldwide web.
According to research published today by the Internet Advertising Bureau (IAB) and accountants PriceWaterhouseCoopers, social media, video and mobile ‘phone advertising spend crossed the £4bn mark for the first time in 2010 and the trend looks set to increase, as more and more people spend more and more time online. The IAB said that people in the UK now spend 25 percent of their total time online on social networks, such as Facebook and Twitter. Therefore, advertising in the social networks alone has risen a whopping two hundred per cent.
Head of the IAB, Guy Phillipson, said that the market was “almost back in its pre-recession heyday", which is encouraging and the report shows that companies have been determined to finance their growth through advertising their wares.
According to the report consumer goods and retail companies raised their online budgets to become two of the four largest spenders on display advertisements. However, the financial sector spent the most in 2010, overtaking entertainment and media, with a 15.2 per cent share.
The figures indicate that Britons are spearheading this internet advertising revolution, as the equivalent spending share is only around 15 per cent in Europe and, interestingly, only 16 per cent in the United States.
Social networking may not have won the Oscars, but it would appear to be winning the advertising awards.
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( 3 / 238 )In the budget last week, Chancellor George Osborne promised a raft of measures, which would result in a ‘bonfire of red tape’. These measures had been widely called for by small business owners, as at least half of small businesses, which have closed in the last few years, have cited over-regulation as the main cause.
According to official figures, the measures are expected to save companies over £350m a year and the biggest beneficiaries will be small businesses. According to the Treasury’s budget report “the presumption will be that all regulations identified as burdensome would be removed, unless good reasons are given for them to stay.”
The changes include scrapping legislation that would have given staff of companies employing less than 250 people the statutory right to request time off to study or train and a moratorium on all new regulations applying to companies employing fewer than 10 staff and on all UK start-ups for three years from 1 April, and a public "thematic review" to reduce the volume of regulation.
However, one element of the ‘bonfire’ has received a less favourable response than given to most of the others. In the budget, the Government also scrapped proposed new dual-discrimination regulations that would have allowed employees at companies of any size to bring two discrimination claims simultaneously, such as age and gender.
This has brought condemnation from organisations representing women and older people. For example, the Fawcett Society, which promotes women’s rights, has said that 75% of the half a million people set to lose their jobs in local government will be women. Societies, such as Age Concern, have voiced concerns over the postponement of new age equality provisions for small businesses.
It would appear that when lighting a fire, it is almost impossible to ensure that no-one gets burned.
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( 3.1 / 233 )Before the budget measures were unveiled, the Government promised the most business-friendly and pro-enterprise measures the country has seen in a long time. Now that the Chancellor has delivered his speech, we can look at some of those measures in more detail. And, on the day when the FTSE repeats yesterday’s bullishness, it appears that the focus is on corporate earnings.
Of course, the companies quoted on the FTSE 100 are the giants of the business world but, like oak trees, they all grew from relatively small acorns. So how can UK plc help its tiny seeds to flourish and grow into sustainable and profitable enterprises?
One measure announced in the budget was the setting up of 21 Enterprise Zones, rather than the ten, which had been expected. These Zones will offer simplified planning rules, superfast broadband and tax breaks for businesses.
Business Secretary, Vince Cable said “‘We will work closely with local enterprise partnerships to identify new ways we can support them on developing the Zones, especially on issues like enhanced capital allowances and securing inward investment.”
So far, eleven Zones have been announced across England and a further ten will be unveiled in July after a competition to locate suitable sites. The British Chamber of Commerce has got behind the Zones and its Director General, David Frost, said “The role of Local Enterprise Partnerships in designating and running Enterprise Zones will ensure that local business leaders are at the heart of the new policy. Beyond upfront incentives, the reinvestment of business rates locally is critical to boosting regional growth.”
And, if the regions perform, then the country performs, as long as the Zones don’t create a movement of jobs rather than a creation of them. As long as the Government is committed to the growth of small business and brings in measures to help it – and, more importantly, keeps regulation to a minimum – then there is every chance that we will be seeing more acorns and, eventually, more oak trees on this green and pleasant land.
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( 3 / 242 )Following yesterday’s budget, the Chancellor now asserts that Britain is "open for business". One of the Government’s aims for the budget had been to help SMEs and encourage their continued contribution to the economic growth of UK plc, whilst supporting job creation and generating industry innovation. And there were some announcements, which could help in achieving that goal.
For instance, corporation tax will be cut by 2% from April, in an attempt to woo business back to the UK, and will continue to fall 1% in each of the following three years, taking it down to 23%, which is the lowest in the G7. In order for banks not to benefit from this cut, the bank levy rate will rise to offset the effects of the corporation tax cuts.
Instead of the previously planned ten, there will be 21 new enterprise zones created across the UK. These will bring tax breaks, reduced planning restrictions and ‘superfast’ broadband. The enterprise zones will also offer a business discount rate worth up to £275,000 over five years for firms that move into the area over the course of this parliament.
Plans are also afoot to merge income tax and National Insurance, which will be a huge boon to employers. This isn’t concrete yet but is definitely on the Chancellor’s radar and will add to the “bonfire of red tape” promised to business by the Government.
The small business rate relief holiday will be extended until October 2012, which certainly contributes to the bottom line and the small business tax rate will be reduced by the expected 1%.
As far as the future workforce is concerned, it was announced that the number of placements for young people on work experience schemes will increase fivefold to 100,000 places over the next two years with funding in place for an additional 40,000 apprenticeship placements for unemployed young people.
So, within the small margin available to him, Mr Osborne appears to be doing his best to help. It will be an interesting year.
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