Against the background of a tempestuous European economy, the UK government continues to battle with the domestic financial landscape and, in particular, the revitalisation of SME lending. However, when it comes to this fight, should small businesses be boxing a bit cleverer, too?
As the question of further public-sector recapitalisation keeps European bureaucrats busy, the coalition government has announced another measure in its struggle to convince small businesses that the growth of this sector and SME lending remain a priority. Over the next four years, it will create 13 new enterprise zones across the country, hopefully creating 30,000 new jobs.
The new zones, which include Gosport in Hampshire, will benefit from tax breaks worth more than £150 million, as well as super-fast broadband and reduced planning constraints. There is also the potential for enhanced capital allowances.
The new zones will bring the total number across Britain to 24 and the investment is certainly welcome. Notably, the plans feature another attack on red tape. However, whether they will convince an increasingly critical SME sector remains to be seen.
But, perhaps these businesses need to look inwards for solutions to their problems as well as looking outwards. A recent survey by business savings advisor Make It Cheaper has found that small business overheads are not lean enough. According to the research, nearly half of small businesses could cut costs if they had more time to find and negotiate the best deals.
While the survey focuses on aspects such as energy costs and raw materials, the same logic can be applied to more general finance. The answer to business banking doesn’t have to come solely from the big high-street players. Invoice discounting, factoring and asset finance are services that can help maintain forward momentum.
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