A SUPPORTIVE ENVIRONMENT FOR ENTREPRENEURS IS VITAL FOR ECONOMIC SUCCESS
Original article written by Leon Fear for Business Leader as featured on their website on 23rd April 2018. To view the original, please click here.
Creating a supportive business environment is, in my opinion, absolutely crucial to the economic success of Great Britain.
The business world is often considered as just ‘big business’ comprising of the multi-national corporations and big organisations, but of course there are millions of smaller businesses which make up an important part of the economy.
SME’s, which by definition mean businesses with less than 250 employees, make up a staggering 99% of all businesses, out of a total of around 5.7 million companies operating in the UK.
Perhaps even more surprising is that 5.5 million are micro-businesses, which employ up to nine people! They alone account for 33% of all employment and 22% of all turnover. That’s an overwhelming majority of small organisations creating employment.
When it comes to the property industry, the population generally look to the national house builders to produce the homes we all want and need, but in parallel to business employment generally, millions of homes are constructed by SME and micro property developers.
Traditional volume developers do, on the whole, a good job of building mass housing which requires significant capital and structured management in order to provide, but when you look at smaller developments, often in urban areas for development and refurbishment of small brownfield sites, or projects of a few houses in rural areas, the local property developer plays an important role as they focus on sites which are usually too small for the bigger developers and can often be more creative and innovative in their approach, as ‘one size fits all’ doesn’t apply in the same way.
Often putting their own house on the line and using high levels of debt, micro and SME developers often run in to cash flow difficulties and work for months or sometimes years with no return in the hope the market remains in tact when it comes to sell their product. The risk associated with this business model, which can mean starting a project with one government in power and finishing it with another altogether, perhaps isn’t always noticed by the general public because property development has a reputation for being highly profitable. Perhaps when you consider the significant risk involved it should reward them well when things go right.
Micro-developers, just like small independent retailers, contribute hugely to the creation of the jobs which generate the taxes the economy needs to fund vital public services like the NHS, Police and Fire Service. In order for these crucial services to be sustainable, the money to pay for them first needs to be created and that is where business, however large or small plays such an important role.