A survey reveals the need for greater education among UK businesses when it comes to finance.
The study, conducted with over 1,000 UK firms employing more than 10 staff, highlights some prevailing perceptions of UK businesses and underlines several key challenges faced by business leaders in today’s uncertain economic climate.
Beyond banks
While 70 per cent of businesses in the survey commissioned by Growth Street, claimed that they had never considered funding their business other than through their banks, fewer than half (45 per cent ) of respondents indicated that they would talk to their bank first if they were thinking of taking on new funding for their business.
Accountants and brokers were cited as playing an influential role as business advisors, but 26 per cent of respondents were unsure what their first port of call might be when looking for funding. This outlines a clear need for increased education and effective signposting of the appropriate alternatives.
Some responses indicated that alternative finance may be moving towards the mainstream. 54 per cent of survey participants stated that they now have some awareness of the funding options from sources other than their banks.
However, there might be more to do before the sector realises its potential: 45% of respondents claimed that they were ‘not at all confident’ in their knowledge of the alternative finance sources available to them.
Beyond borders
Exporting may well be a potential area of growth for businesses: 66% of our survey respondents didn’t export goods or services at all. (Of those engaged in exporting, only 1% did not sell to EU countries.)
Guidance for new exporters is an issue that may require further thought. In response to the question, ‘Do you agree that enough official guidance and information is made available to businesses who are looking to begin exporting?’, fewer than 20% of respondents strongly agreed. When asked, ‘If your business were to require funds to fuel new exports, would you be confident of knowing what kinds of funding might be available?’, fewer than 30 per cent of respondents said ‘Yes’.
Understanding: the key to business growth
Greg Carter, Growth Street CEO, comments: “With strict lending criteria from the banks, it’s vital for businesses to understand the alternatives that might be available to them. Surveys of this kind deepen our understanding of the needs of growing businesses.
“With international trade having been thrust into the spotlight, I believe potential exporters need significantly more guidance when it comes to exploring new avenues for growth. This could be critical for Britain’s long-term economic prosperity with the process of leaving the EU still under way.”
Read more about the results of our survey in our report which you can download for free here.