Friday 10 July 2020 4:34 am

When it comes to government business support, one size does not fit all

Save our SMEs
Irana Wasti is president of GoDaddy (EMEA)

When it comes to getting noticed, unfortunately size does matter. 

There are millions of micro businesses (those made up of fewer than nine employees) across the UK, which play a crucial role in our economic health. In the months to come, their ability to be nimble will be vital in helping this country navigate through an economic downturn. 

But, as the chancellor’s summer statement this week highlights, our businesses need support to ensure a healthy economic recovery for the country. And to play their part in that recovery, small firms in particular need a boost.

Read more: The City View: ‘The second digital revolution’ – with Irana Wasti of GoDaddy

Since the lockdown, I’ve been incredibly impressed with the resilience and creativity that we have seen from GoDaddy customers, the everyday entrepreneurs across the country — whether it’s vegan pie business Magpye, which moved from selling from its food truck to selling entirely online, offering free local deliveries, or chocolate drinks maker Knoops which launched its own drinks machine (“the Knoopifier”) to enable customers to enjoy their drinks at home.

But the sad reality is that when it comes to much-needed government support, micro businesses often unwittingly end up at the bottom of the pile.

What this means is that through complicated bureaucracy, limited access to capital or having a lack of financial history (all precursors to many government support schemes), the very companies which need help the most can be the ones who find it hardest to access.

This is a missed opportunity. The remarkable response to our #OpenWeStand campaign, where we offer online support for our community during these challenging times, has shown that micro businesses are happy to adapt and keen to learn. 

Our recent polling of 1,000 UK micro businesses during lockdown shows that one in five respondents have gone online for the first time, which is nothing short of a second digital revolution. Two thirds have created new products and services in response to the outbreak, with 65 per cent saying they are keeping them as lockdown begins to ease. 

Looking to the future, consumer behaviour is online, small and local. A sizeable majority (63 per cent) of consumers say they have been shopping at local micro businesses during the lockdown restrictions, and over two-thirds said that they will continue to do so longer-term. 

But as the lockdown slowly eases, people are now rightly wondering how long these businesses can survive, and what the “new normal” will look like for them. 

Recovery will mean different things to everyone — and it will force us to approach age-old questions differently. For micro businesses, I believe we need to focus on three key areas. How do we ensure that micro businesses have access to capital and other tools they need to survive? How can we help entrepreneurs create micro businesses in underserved communities? And what is the best way to invest in technology, infrastructure and skills training?

One size does not fit all, and if we want 96 per cent of the UK’s businesses (as measured by the Office of National Statistics ) to play a crucial role in our recovery, the government should be encouraged to think of ways to continue to support them.

Read more: Small business advisers, your country needs you

Main image credit: Getty

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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