The Importance of Small Businesses

Small businesses are often described as the backbone of the economy because of the jobs they create and contribution they make to national prosperity. But do they need more support from government?

Small business rule the world

The majority of businesses in the economy are small, which means many employ less than 50 people. In reality however most small businesses employ less than 10 people and thrive in every location and area of activity. Such coverage means jobs are provided in cities, towns and villages and act as the glue that binds local communities together. Through the dedication, hard work and skills of small business owners many grow into big businesses and trade internationally. The ability to export products and services to countries around the world serves as testament to the determination and drive of the founding entrepreneurs.

Small businesses provide jobs in every sector of the economy as they operate in agriculture, construction, manufacturing, retail, technology and countless other areas. New start-up businesses also serve every facet of life, as they disrupt traditional markets and create new ones on a daily basis. Turnover and profits vary widely amongst small businesses as they compete with established entities to find customers and recruit staff. But most importantly they provide a reliable pipeline of employment for local people as supply chains reach into all parts of the society.

Government support however often targets big business and overseas inward investors. Both groups are worthy of such help and will always warrant the attention of national economic policy makers. But it is equally important to assist small businesses, not least because of their habit of providing local employment. Such commitment adds value to neighbourhoods in all parts of the country, rather than just those in cities and other large centres of population.

Some challenges

Developing products and services that customers want lies at the heart of every successful small business, as does the energy provided by the owner. But it is also useful to write a business plan to address the key challenges and set a clear vision for the company. Succession planning is essential too, as the ideas of owners need backing from a wider team with the experience to make the business work. Brexit is of course one of the biggest challenges facing small business today, as it creates uncertainty and destabilises the normal trading environment. But small business owners are naturally resilient and thrive on finding solutions to problems regardless of circumstance. The current economic turmoil will no doubt create future difficulties but small business owners always find ways to succeed and offer local jobs to local people.

So, small businesses play a vital role in every successful economy and should be supported by government in the same way as large businesses and overseas inward investors.