For all the political posturing, no one has come up with any good ideas on how to help small businesses through this rather difficult time. In fact, they are being ignored. Entrepreneurs are the bedrock of this country’s success, and there are thousands of them just busy getting on with it. They don’t have time to lobby ministers and say: “Hey, we’ve got some serious problems here.”
We suffer from the fact that we don’t have strong leaders or voices who can speak on our behalf. We don’t have a strong enough personality fighting our corner, and that needs to change urgently. We need a strong, charismatic leader.
We need a small business department. But we don’t have enough people in government who have actually been through the ups and downs of running their own business, sweating over paying their staff. Until that happens, we won’t have
people really representing our interests and understanding our burdens.
The current climate is an opportunity for banks and financiers to take the piss. Many people have had a visit from their bank manager, who wants to change the terms of their overdraft or loan, putting it up two percentage points, which in itself is going to restrict growth, if not cripple lots of businesses. They see this as an opportunity to get more margin in the short term. And to an extent, the reason we’re in this mess in the first place is because the big financiers were thinking about what they could do to boost short-term profits. I’d like to see some rescue packages for small businesses that will help them in the long term.
Of course there’s the Small Firms Loan Guarantee (SFLG) Scheme. This should be a lifeline for those who have no assets on which to secure a loan. But the banks aren’t on board. So we have a fund that sounds brilliant on paper, but is really redundant, especially in this environment when banks don’t want to take any risks. Banks need to be given targets to hit, because even though there’s only a 25% risk, they don’t even want that. They didn’t want it before the credit crunch; they’re certainly not going to want it now. The banks caused the downturn, yet are refusing to kick-start the economy by lending, and the only thing the government can do is bully them. That’s why I believe we need to have some sort of system where they have to lend X amount through the SFLG scheme, which then can be broken down branch by branch.
I also think we need an entrepreneurs’ bank for businesses like mine that struggle to get funding. If it isn’t an asset-based business, it’s tough securing finance. My asset is in my brand, but banks feel more comfortable with bricks and mortar.
Start-ups either go down the venture capitalist route, where you end up being an employee, or to banks, which want collateral. There needs to be something in between to encourage entrepreneurs, and give them the chance to make it.
About the author
Wilfred Emmanuel-Jones is the entrepreneur behind The Black Farmer food brand, successfully fighting to get his premium sausages stocked by major UK supermarkets. Growing up in Small Heath, one of the poorest areas of Europe, he overcame dyslexia to make an impact at the BBC, before striking out on his own to realise his
vision of taking fine foods to the masses. A former winner of the BT Business Essence of the Entrepreneur competition (www.bt.com/essence), his brand
is currently valued at around £6m.