SMALL BUSINESS OWNERS

Governments Do Not Understand the Motivations of Small Business Owners

Governments Do Not Understand the Motivations of Small Business Owners

Introduction

Government and Corporate Business don't understand the small and medium sized business sector. Basically the SME sector has around 4m businesses (in the UK) who employ 12 Million people, and each and every one is different and generally is a reflection of the owner's attitude, ambitions, background and motivations, so lumping all small business owners into an SME category does them, and whoever is doing the lumping, a big disservice.

Businesses and business people are all different and unless Government and corporate understand that they will never 'get' small business. On our Industrial Estate, we have a furniture manufacturer, a small tool making company, a wholesale butcher and an internet printer ink supplier, all of whom have totally different needs and totally different attitudes to business. If you run your own business you just 'get on with it' and make do. These are the main five differences between a small business owner and his corporate counterpart:

Small business owners have always had to do more with less, typically because they don't have the cash resources to spend. This generally means that the business owner does a bit of everything and provides cover personally for holidays, sickness or busy periods. As the owner generally knows his (or her) business better than anybody else they are able to ensure that the 'job gets done' without incurring any extra expense (Van Praag 2007, 351).

Because most small businesses run very lean there isn't much fat to cut. The biggest savings any business can make are in people, but most SMEs generally only recruit new people when they can no longer cope with the staff they have, so there isn't an opportunity to cut in this area unless revenue downturns, in which case this expense is the most critical to get right. All other overheads pale in significance compared to employing people. In any small business it's not a case of using their size to ensure they are adaptable, it is using the people that you have available in the best possible manner for the benefit of the business. This very often means that the business owner is working longer and harder than anyone else to enable the flexibility that is needed. The issue of spotting opportunities when they come along is a difficult one because you can get so focused on your current problem/opportunity that very often new opportunities are missed

Investing in Technology is a great enabler, we have invested heavily in software systems over the period that we have been trading & these have enabled us to double our turnover year on year, but not increase our staff in critical areas. If we hadn't invested in recent software upgrades we would need at least four more people in our admin and two or three in our stores area.

Description and Analysis

The small business sector is an increasingly important component to larger ...