It’s therefore not surprising to see that business growth is firmly on the political agenda as we hurtle towards a general election – with some excellent public funded support available for SMEs.
Finance and skills remain the focus for most companies, and I forecast a hat trick of cost effective opportunities for ambitious SMEs seeking to expand this year.
1. Funding – giving more choice and opening doors
Equity crowdfunding and angel investment continue to gather momentum, providing many innovative SMEs with cash injections when more traditional funders have turned them away. Funding streams such as these enable private investors to collaborate and provide finance for companies across a range of sectors.
These alternative finance options have gained traction as interest rates have stagnated, with many private individuals opting to invest in SME businesses as a way of securing a good ROI.
Not surprisingly, the government is muscling in on the act with the formation of the British Business Bank – a state-owned establishment with over 80 private sector funding partners. The bank was created by the UK government to increase access to credit for SME’s and to provide business advice services.
As the economy recovers, many high street banks have been slow to respond to the growing demand for finance. However, there are now signs that lending levels are once more beginning to rise.
The recent proliferation of alternative funders may be spurring high street banks to become more proactive in terms of business finance. Let us hope that over the course of 2015 their doors will be open wider to those SMEs who have been hit particularly hard by the banks’ tightening their grip on funding.
2. Cash in on Intellectual Property
You could be sitting on tens of thousands of pounds in Intellectual Property (IP) assets so ensuring that you understand the value of your IP makes sound business sense.
The IP Audit Plus programme – part of the government’s Growth Accelerator for small businesses – offers funding of up to £3,000 including VAT for an intellectual property expert to assess the value of a company’s IP collateral.
The audits, which are suitable for all sectors, enable established companies to take a step back and assess where their value lies.
A report last year from the Intellectual Property Office on the IP Audit Plus found that the audits had highlighted new business opportunities in 31% of participating businesses, with 28% stating that they had reaped financial benefits as a direct result of their audit.
In a further business boost, the report demonstrated that IP reviews had opened up new financial support streams such as equity funding (23%) and grant funding (30%).
During the audit, the IP expert, usually a lawyer, examines your brands, copyright, patents and trademarks and also looks into any possible third party infringements.
As well as identifying how you might exploit your IP through licensing or franchising, knowing the value of your IP assets can be critical in valuing your business for a future sale, a management buyout or for an injection of funds from private equity investors.
Apprenticeships – helping to address skills shortages
Many SMEs tell me that struggling to recruit the right staff is one of their biggest business challenges. Yet just 10% of small businesses employ apprentices, according to the Holt Review of Apprenticeships.
In a bid to increase these figures, the government is encouraging small businesses to take on apprentices with its Age 16 – 24 apprenticeship grant of £1,500 per young person – recently amending the criteria to attract a wider range of employers.
With university fees costing up to £9,000 a year, increasing numbers of bright young people are looking to apprenticeships as a step onto the career ladder.
When you employ an apprentice, you have a unique opportunity to train a young person in your ways of working, whilst also addressing a specific skills shortage in your own business and within your sector. An apprentice can also bring a fresh approach and new ideas into the business.
Additionally, retention levels for apprentices tend to be high, with research showing that 67% of apprentices remain with their employer after completing their apprenticeship and progress through the business – even to management level.
SME’s have had a tough few years, but most are optimistic about the future.
According to a recent survey by Western Union Business Solutions International Trade Monitor, 83% of SME’s said that they were ‘very confident’ about the UK’s current economic climate. An improving economy, coupled with a plethora of innovative cost saving opportunities means that 2015 looks set to be a storming year for business growth in the UK.