Running a business during the recession

Those who are considering starting their own business should have good entrepreneurial skills as they are even more essential in the current economic climate, it has been suggested.

An expert has issued some advice about the areas which need consideration, with costs bases being one of the most important.

New firms have to be especially careful when considering where to spend their money as it can make a great difference to the company, its products and the services sold.

Likewise, efficiency is vital to prevent costs from spiralling out of control, Mark Parker, executive chairman of Talkbiznow claims.

He has also warned that some businesses are likely to struggle because of the very nature of the current environment when they may have survived under difference conditions.

"Inevitably some businesses will struggle in this environment and frankly it's not because they haven't done anything wrong, it's because the money isn't there and people haven't got the money to spend," Mr Parker stated.

"I think a lot more support must be given to those companies to help them through these difficult times rather than just let them go to the wall," he furthered.

Small to medium-sized enterprises, whether it be those that are just starting out or more established companies, are likely to be more than welcoming of any help and support that can be provided to them by the government and its officials.

People running their own business may find that aid given to them now will help to see them through the recession and they can emerge from the other side ready to make a real go of their company.

This may be especially useful when considering recent statistics from the Insolvency Service.

In the third quarter of 2008 there were 4,001 compulsory liquidations and creditors' voluntary liquidations in England and Wales.

When compared to the statistics from the same time last year it was found that there had been an increase if 26.3 per cent. Liquidations were also up by 10.5 per cent on the previous quarter of 2008.

While 1,483 of these were voluntary, 2,518 were compulsory liquidations.

To further add to the troubles of those running a business, the new empty property tax reprieve from the government means firms are "being kicked while they are down", according to Savills.

David Parker, national head of rating at the company, claims that the proposed legislation does nothing to help the small businesses which are contributing so much to the British economy.

He said that many "who are being forced to slim down their operations are then faced with not only having to lose some of their premises, hopefully temporarily, but they are being taxed on it as well".

Mr Parker does not believe that the solution goes far enough to addressing many of the problems faced by British companies.

It appears as though the odds are currently stacked against many people running their own small business, however if they can manage to survive the recession they may then have the opportunity to make some money and begin to reap the benefits and enjoyment of having their own firm.

  • Starting a Business News from Lawpack: legal forms and straight-forward advice on limited company formation, business partnerships and self-employment

Published on: December 19, 2008

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