With SMEs accounting for 99.9% of all private sector business last year and providing an impressive amount of employment throughout the UK, nurturing and developing small to medium sized businesses is vital for the British economy.
The IoD’s Alex Mitchell chaired a ‘Director Roundtable’ in the February 2016 issue of Director Magazine; bringing a panel of 9 SME business owners together to discuss the difficulties small businesses face in the UK. The magazine article explores how the panel believe small companies should be supported in the key beginning stages of business.
The panel included the likes of Andy Wilkinson, Managing Director of OWB Creative Communications, Sean Nicholson, founder and CEO of Sign Solutions, Damian Clarkson, Managing Director of The London Kitchen – amongst other credible business owners and directors. Pick up the latest copy of Director to see the full panel line up.
BACKGROUND READING: Who are ISO and why do they exist?
Host of the discussion, Mitchell, divulged there has been a notable shift in the UK with people wanting to start their own businesses. A record 581,000 were launched in 2014, with 2015 predicted to beat that figure. Despite this, the UK still to this day sees a record number of start-ups folding within the first two years of operation; which is often due to entrepreneurs not putting enough money aside to pay their initial tax bills and other unexpected outgoings/expenses due to lack of exposure/planning. He explains,
“At a time when more individuals are starting up businesses, the UK has dropped from 4th to 9th in the Global Entrepreneur Index ratings because there’s an issue around creating an ecosystem that can take start-ups forward to turn them into job creators of 10, 20, 30 more people; £2m-£3m companies.”
At the start of 2015, SMEs accounted for 99.9% of all private sector businesses. The total employment in SMEs last year was 15.6 million, equalling 60% of all private sector employment in the UK. Furthermore, SMEs in the UK created 47% of all private sector turnover in 2015, totalling £1.8trillion! These figures prove the importance of SMEs to our economy and the success new businesses can have in the future when they are structured and managed effectively.
Overall the number of SMES has increased by 1.9million (56%) since 2000 and the number of SME employers has grown by 18% (201,000 employers). Since 2000, the number of medium-sized employers grew by 21%, while the number of large businesses fell by -3% which can be explained by mergers and business takeovers.
Mitchell revealed the US has the Small Business Administration in place, where a quarter of contracts go to small businesses compared to just 10% in the United Kingdom. Wilkinson, of OWB Creative Communications, explained how his business has overcome this obstacle by having the internationally recognised Quality Management System, ISO 9001 in place:
“One of the things we did, which has paid huge dividends as a creative business, was to go down the route of ISO 9001 and the Investors in People Standard. Now when we go for OJEC (Official Journal of the European Community) tenders, we almost go straight through the PPQ (pre-qualification questionnaire). It’s a huge investment of time and energy obtaining and maintaining ISO but it’s paid off across our business, processes and people.”
Since 1987, when ISO 9001 was first written, the standard has been internationally recognised as the ideal way for businesses to prove they are delivering a quality product or service to each and every customer. ISO regularly review the standard, constantly improving and updating the clauses ensuring it’s relevant in this day and age. Most recently, the Quality Management System was updated in September 2015. ISO 9001 sets a benchmark for global best practice in Quality Management and as a result the certification is often stipulated in important government tenders and supply chain questionnaires – ensuring they only choose from the best.
ISO 9001 at a Glance:
- Helps win new and retain existing business
- Reduces mistakes and re-work as a result of mistakes
- Increases business efficiency, productivity and profitability
- Suits all types of businesses, small to large
- Improve internal processes for staff to adhere to