The challenges being faced by small and medium-sized businesses (SMEs) across the Midlands have been highlighted in a report by banking-giant NatWest.
The 2021 Small Business Report was conducted in conjunction with the British Chambers of Commerce (BCC) and the Federation of Small Businesses (FSB) to identify the barriers which are preventing SMEs reaching their potential.
The report – which will be shared with the UK Government as it develops the Help to Grow initiative – found that SMEs often struggle to find a support programme tailored to their needs – and only a fifth of businesses decide to access that support.
The document revealed that better targeted and personalised support for SMEs could unlock £140 billion boost to the UK economy by 2030 – equivalent to creating 3.2 million new jobs across the UK.
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This includes a £35 billion boost for both the East and West Midlands, where productivity among SMEs lags that of larger firms by 15 per cent.
SMEs are defined as firms which have between one and 249 employees. There are 121,000 SMEs in the West Midlands and 98,000 in the East Midlands.
Now, in response to the findings, NatWest has announced a series of interventions focused on scaling-up micro businesses, to unlock the untapped potential outside London and boosting skills and technology adoption.
- A funding commitment of £6 billion to support SMEs to scale and grow, £4 billion of which will be allocated outside London;
- The creation of 30 local enterprise managers and 20 entrepreneur acceleration managers designed to give businesses the support they need, when they need it;
- A commitment to help 10,000 NatWest customers to get the best training or growth opportunity and;
- New strategic partnerships with Business in The Community (BITC), Hatch and Digital Boost, to empower underrepresented entrepreneurs and communities and embed new skills and technology.
John Maude, chairman of NatWest’s regional board for the Midlands and East, said: “The findings of this report have shown us that SMEs are not a homogenous group, and that support available across the Midlands and the wider country need to be more closely tailored to their specific needs.
“We’re also seeing a continued disparity in the allocation of support and funding by gender, location and ethnicity. It’s the responsibility of our entire industry to help reset this balance to help all SMEs and by extension the UK economy to thrive again.
“In recognition of that, NatWest is delighted to be partnering with both the UK Government on the Help to Grow programme, and with partners like Hatch and Digital Boost, to support future and existing SMEs with expertise and advice on how to get to that next level.
“Combined with an additional £6 billion of targeted funding, we are confident that these initial steps will help us unlock the growth for the business success stories of the future.”
Federation of Small Businesses national vice chair, Martin McTague, said: “It’s encouraging to see NatWest championing the small business cause, and we look forward to it, and all major banks, doing absolutely everything in their powers to help small firms recover from a torrid year.
“Many are emerging with high levels of debt, low levels of cash and shattered confidence as they look to make their way in a trading environment that remains unpredictable. We need to see government, big businesses and financial service providers alike pulling out all the stops to help the small firms and sole traders that make-up 99 per cent of our business community get our economy firing on all cylinders again.”
Adam Marshall, Director General of the BCC, added: “SMEs are the engine-room of the economy and their ability to bounce back and grow exponentially will be crucial to the UK as a whole as it emerges from lockdown.
“It’s great to see the potential of our SMEs reflected in NatWest’s new report, which hits on many of the key drivers that would enable small and medium-sized firms to restart, rebuild and renew.”