Starting your own business is seen by many as a high risk venture, that could see you bust within the first year – but it might surprise many skeptics to learn that 80% of new businesses survive their first year of trading.
The myths surrounding starting and running a business research released today by the Department of Trade and Industry highlights some of the myths that discourage many people from taking the plunge and starting up their own business. The research reveals that it is a myth that it takes years to start a business from scratch whereas it is a fact that most businesses are established within six months.
Equally, it is untrue that the rejection figure for business loan applications is significantly higher than it is – in fact, only 10-20% of applications are rejected. Many people perceive that it is difficult to make an adequate living from a start-up although in reality people’s estimate of income in their first year of trading is only half of the figure actually achieved by small businesses.
Barry Gardiner, minister for competitiveness at the DTI, says: “Prior to entering parliament, I too started and ran a business. Before making the first step I – like others – was faced with potential concerns. Many of these turned out to be misplaced and I am glad I made that leap into business. I want many others to do the same.
“There are now a record 4.3 million small businesses in the UK – this is over 500,000 more than seven years ago. Small businesses and start-ups make a major contribution to the health of the economy, increasing jobs, productivity and prosperity, it is therefore essential that the myths surrounding starting up a new business are dispelled.”
Building on the outcomes from the conference, the DTI’s small business service will work with partners to find ways to use this research to influence national/regional marketing and communications aimed at encouraging more people to consider starting a business. This year’s government funded enterprise week saw over 2,000 events take place involving an estimated quarter of a million of young people. The government is also putting 60m a year starting this year to provide enterprise education in schools to help encourage more young people to regard entrepreneurship as a worthwhile career choice.