Small is beautiful ... or is it?

A piece of market research arrived this week from accelerator offering an introduction that they were ‘aiming to find out what’s really going on at the front line of small business’. In an earlier blog – September 18th 2006 – I noted that in terms of numbers 99.3% of all British businesses were officially classed as small, that is they employ 49 or less people according to government statistics. Of course the mere act of taking on employees immediately changes the nature of a small business – you are now managing people and dealing with a whole raft of employment legislation – and it is easy to forget you actually need to service clients and customers to make money that creates wealth. May be that is why nearly two thirds do not have employees. Of those that do the second biggest perceived threat is actually recruiting and keeping good staff. Not surprisingly 71% thought the UK government did not do enough to foster small businesses and business people. So no surprise there. Despite this 72% thought the UK a better place than Europe to start a business but significantly only 34% and 42% respectively thought the UK better than North America and Asia. Autonomy rated at 38% was the top reason for preferring to work in a small business. We are left with the question of whether there are two emerging business communities – the relatively few global giants and the mass of small businesses. Our experience suggests big businesses talk about marketing expenditure within an often somewhat arbitrary budget, whereas small businesses focus on generating more business profitably. What the statistics suggest is that marketing one small business to other small businesses is a factor that cannot be ignored and business to business technical marketing will need to provide efficient means to do this successfully.