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Never a better time to start your own business?

Why more people than ever in the UK are starting their own enterprises

As reported in October, according to the government the UK now has some 5.4m private sector businesses - a new record and 900,000 more than in 2010. Some 35,000 more businesses employed people than in 2014, with small firms providing 48 per cent of private sector jobs and adding £1.2 trillion in turnover to the UK economy.

According to the Department for Business, Innovation & Skills, (source: Business population estimates 2015) the UK has about 3.3m sole proprietors and some 1.6m companies.

The UK start-up figures are equally as impressive. According to think tank the Centre for Entrepreneurs, which runs national campaign StartUp Britain, since 2011 annual UK start-up rates have increased from 440,600 in 2011 to over 610,000 in 2016.

Technological progress

So, why are so many people starting their own business? In his executive summary to The Report on Small Firms 2010-2015 Lord Young, advisor to the Prime Minister on enterprise, writes: “Many factors have affected the environment for small firms including tax and regulation, but the biggest difference has been the accessibility and mass adoption of new technology.

“Technology has lowered the barriers to entry for people from all backgrounds and ages to make a business idea happen, and to use mobile and digital devices to find customers, make sales and fund new ventures. While the internet arguably reached critical mass in 1997, it has really been within the last five years that smart phones and tablets have become relatively cheap enough to become commonly used by people to go and work for themselves.”

Cultural change

According to Lord Young, there has also been a “complete culture change” in the general attitude to entrepreneurship and small firms. He adds: “In the last five years I have met countless numbers of inspiring entrepreneurs - from all ages and backgrounds - [with] all reporting that starting a business is the most exciting and challenging thing they have ever done.”

Thinking back to before this current Parliament, he argues, there was: “Little effort to inspire and encourage people to consider entrepreneurship as a viable career choice; public sector procurement was virtually closed to small suppliers; small firms reported that the landscape of business support was too confusing and inaccessible, including very few sources of finance to start and grow a business; and there was very little recognition within our education system about the skills and attitudes that enterprise can offer young people to prepare for their futures, including the opportunity to be their own boss.”

Start your own business

Arguably, staring your own business has never been easier or cheaper. There is a wealth of free online information and support you can access. Simple online research can help you to quickly and easily find out about competitors and potential customers and find suppliers. Registering a business can now be done very quickly at little or no cost.

It’s possible to start and run a business from your home and sell to customers not only nearby, but throughout the UK and overseas, with strong demand for a bewildering array of products and services. Social media can offer a highly cost-effective way to market your business.

Key motivators

People start their own business for many reasons. Some because they see it as the only way to earn more money (although there are no guarantees of great wealth, of course, and half of all new businesses are believed to fail within a few years). Entrepreneurs now have an elevated profile and status, although few achieve genuine fame. Starting and running your own business can offer much more excitement and satisfaction than working for someone else.

Some people start their own business because it grants them flexibility they wouldn’t get as an employee. Others grow tired of taking orders from other people or feel stifled in their jobs, which is why they want to become their own boss, take decisions and determine their own destiny. A few come up fresh business ideas or they spot a gap in the market.

Starting your own business and growing it isn’t easy or without risk, and working for yourself can be a rollercoaster ride of great highs and lows. Some days you might wonder why you left the relative security of working for someone else. On other days you’ll think starting your own business is one of the best things you’ve ever done.

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How to come up with and test business ideas

Next step:

Use our online tool to create a start-up business plan