Increased Competition Named as Small Businesses Biggest Threat
Rising material costs and red tape barriers named as other major concerns for companies
A new report by Bibby Financial Services revealed start-up rates were at their highest in five years, with 24% of small and medium firms stating that an increase in competition was their biggest concern.
According to Companies House data there were 54,336 incorporations in March with figures continuously rising since the recession ended (see graph below).
The research, which involved a survey of 1,000 businesses, also highlighted other key concerns for small and mid-sized business. Rising raw material costs (15%) was listed as the second biggest threat (13%), followed by barriers due to red-tape (13%), access to finance (9%) and a lack of skilled staff (8%).
David Postings, UK CEO of Bibby Financial Services, discussed the change in the UK business composition:
“This is certainly a different picture from just a few years ago and the UK has returned to its position as a breeding ground for innovation and entrepreneurship. The economic downturn has fostered a DIY ethos in the country, which is now paying dividends for the economy through both recruitment and output.
“Technology is undoubtedly removing barriers to entry for a lot of industries, but it’s vital that new-start and early stage businesses have the financial means to invest for long-term success.”