In Focus Collections Making a strategic decision
Will the government’s new industrial strategy provide a strong basis for small businesses to survive and thrive?
Mike Cherry National chairman, the Federation of Small Businesses
Last month, the government released its industrial strategy white paper Building A Britain Fit For The Future. The publication marks the first phase of the journey to improve the UK’s productivity, leading to sustained wage growth and an improvement in living standards – but it is essential we quickly move on to phase two. We agree with the ambition to set clear
‘grand challenges’ for the UK economy and will be working with government to ensure small firms play their part in initiatives such as the Industrial Strategy Challenge Fund and the Small Business Research Initiative. However, this is only the first piece of the
productivity jigsaw. To have a sustained and game-changing impact on the economy, the focus needs to be on how to improve productivity across the UK’s 5.5 million small businesses and the self-employed. We are keen to take part in the announced review into improving the productivity and growth of small and medium-sized firms. We welcome the recognition of the vital
importance of supporting the spread and diffusion of innovation. But a lot more needs to be done to increase productivity by encouraging firms to adopt new-to-firm innovation into the heart of their businesses, as well as a fresh look at how regulation can support small-business innovation of all types. These are the types of issues we want to see the SME review address.
International trade Exporting is key to driving up the productivity of small businesses and therefore we welcome the review of export strategy, reporting in Spring 2018. One in five small businesses already export
and there is potential to double that number if the right support is put in place.
January 2018 We had pushed for more help for SMEs
in the Autumn Budget, and hopefully this process will lead to that help being provided, as we approach Brexit. Any export review must have small businesses front and centre, and not disproportionately focus on mid-scale and larger businesses. The review needs to deliver on the
commitment to work with all of the private sector to ensure that all businesses receive high-quality export advice. Import substitution represents a genuine
opportunity for small businesses – but they will need help to improve competitiveness to capitalise on this opportunity.
Skills and infrastructure We welcome a reinforcement of commitments to skills training, and physical and digital infrastructure, as well as access to finance, that will support productivity improvements in all small businesses. We are pleased to see the roll out of a network of British Business Bank regional managers by the Autumn of 2018 to ensure businesses know how to access sources of investment.
A lot more needs to be done to increase productivity by encouraging firms to adopt new-to-firm innovation
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The supply chain The appointment of the small business commissioner is a positive step, and we are pleased to see this acknowledged in the industrial strategy. To have an impact on the poor payments crisis that afflicts the UK economy, the office must remain tightly focused on this issue. However, we do not think they alone can
be the answer to improving supply-chain practice. Sector deals must have best-in- class supply-chain practice hardwired into their DNA, and we will be pushing ministers hard to ensure this. >>
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