Entrepreneurs are worth their weight in gold to the UK economy and more are needed, according to a recent study conducted by the Centre for Economics and Business Research.
Britain needs a further 300,000 entrepreneurs to restore the economy to its pre-recession peak, according to the survey commissioned by international insurance group, RSA. And, with small and medium size businesses (SMEs) contributing 52 per cent of private sector Gross Value Added* to the UK economy, that’s an ‘enterprise army’ needed for the UK economy to prosper.
But, with the traditional lenders tightening their belts, and against the backdrop of downgraded economic forecasts by the Chancellor, how are new SMEs expected to raise the capital needed to realise their ambitions and what is their best chance of survival?
“The key for all SMEs seeking funding is in choosing an adviser who understands the finance market and which banks and other lenders offer what products,” explains a spokesperson for BM Structured Finance, specialists in sourcing and restructuring debt finance for SME businesses.
Choosing a finance partner is not a ‘one size fits all’ exercise. But at usually no cost to them entrepreneurs can realise their ambitions by working with an independent adviser who will tap into the wide reaching network of financial providers, both in the equity and debt markets, and find the right funding solutions appropriate to their individual needs.
It is, however, not only about securing the finance SMEs need; it’s also about making sure entrepreneurs are adequately equipped to get their business off the ground and on the right path to success.
Matthew Burge of Beavis Morgan, the accounting and business advisory practice, explains, “As an entrepreneur, it’s important to choose an adviser with a detailed understanding of the specific issues that can arise in start-up enterprises. One with broad sector experience who will help you find the best structure for your SME business and advise on the most appropriate options to minimise tax charges.”
According to the survey, the manufacturing sector saw only one percent growth over the last two years, as compared to the Administrative & Support Services and the IT sector which saw increases in the number of SMEs of 23 per cent and 20 per cent respectively over the same period.
“With the large disparity in growth in the number of SMEs across sectors, one can see why it’s important to partner with an adviser who regularly works with entrepreneurial businesses and can help you effectively navigate your options,” says Matthew, who himself has not forgotten that Beavis Morgan was once a start-up business too.
Matthew also recommends that entrepreneurs choose an adviser who can undertake Research & Development (R&D) claims; the qualifying criteria for which are considerably broader than many entrepreneurs realise.”
“SMEs can claim a deduction from taxable profits of 225 percent of their qualifying R&D expenditure,” he says. “And, with the Chancellor’s recently announced increase in the Annual Investment Allowance limit from £25,000 to £250,000, effectively all qualifying capital expenditure incurred could be deductible in full, provided the timing of the expenditure is correctly managed.
”So the recent findings published by RSA should be music to the ears of UK entrepreneurs with good ideas, but the message is clear; partner with the right advisers from the outset and give your business every opportunity of achieving a strong and profitable future.
At Beavis Morgan, we specialise in working with entrepreneurial people across a wide range of sectors, helping them set up and run their own businesses and guiding them through each stage of the process. Our assignments are always partner led and we work closely with clients, helping them avoid the pitfalls and advising them in making the right decisions both now and for the future.
For more information about Beavis Morgan’s entrepreneurial business services contact Matthew Burge on Tel: 020 7417 0417 or Email: matthew.burge@beavismorgan.com. For help in finding the funding you need for your SME business, contact www.bm-structuredfinance.com.
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Source: http://news.rsagroup.com/pressrelease/view/1249 Friday, 14 December 2012
* GVA is a measure of the value of goods and services produced in an area, industry or sector of the economy.