2015 News and Media

UK Start-Up Business owners calling for more education

According to Just Cash Flow PLC research.

Fewer UK businesses would fail

According to 63% of SME owners if they had more knowledge of the business world prior to setting up themselves.

Business Owners didn't know everything

80% admitted that they didn't know everything they needed to when they first set up their business.

And lacked financial and business planning

A further 48% admitted they lacked knowledge when it came to financial and business planning.

Fewer UK businesses would fail if owners had more knowledge of the world of business prior to taking the plunge and setting up themselves, according to two thirds (63%) of SME owners.

Small business owners are now calling for more education for those in the process of setting up in business, as research today reveals many directors went into business blind and confess they made big mistakes along the way.

The research, conducted by alternative lender, Just Cash Flow PLC, spoke to 250 small business owners, and 80% admitted that they didn't know everything they needed to when they first set up their business; with a further half (48%) admitting they lacked knowledge when it came to financial and business planning.

Watch the research video

Small and medium sized businesses employed 15.2 million people at the start of 2014, and had a combined turnover of £1.6 trillion – highlighting the strong correlation between the success of SMEs and our local economies.

The areas of concern that SME owners wish they'd known more about before setting up in business have been revealed to be finance (30%), planning (29%) and forecasting (23%). However cash flow management (36%) has been flagged as the top concern that business owners face.

The lack of business knowledge has resulted in 14% of those surveyed admitting to making mistakes that have put their business at risk, and 10% have made errors that have cost their business dear.

John Davies, Director of Just Cashflow says the report supports a call for more education to be put in place for those looking to set up a business: "We get to see many excellent applications for finance but unfortunately we also receive requests from Directors that clearly don't understand basic business fundamentals. Our experience and this research shows a national qualification for Directors would be really beneficial.

"A report from October 2014 revealed that over half of UK start-ups fail in the first five years and I believe a lack of business education is the key reason behind this shocking statistic."

Holly Porter, Director and Founder of Surface to Air Architects set up in business 11 years ago with very little knowledge and experience in business. She said "To be honest I knew absolutely nothing about basic business planning when I started the business so there are a lot of things I wish I knew before setting up. Especially how difficult it is to get paid -the reality is that just giving an invoice for a service you have provided, doesn't automatically mean they're going to pay it."

Research conducted by Vital Statistics on behalf of Just Cash Flow PLC – sampled 250 UK small business owners in May 2015.

"A report from October 2014 revealed that over half of UK start-ups fail in the first five years": Taken from a study by RSA in 2014 that spoke to 160 business owners.

Research Results

Which of the following areas do you wish you had known more about before starting in business?

Planning

29.20%

Forecasting

23.30%

Cash flow management

36%

Finance

30%

People management

21.2%

Invoicing

7.2%

Social Media

11.6%

Sales

6.8%

Marketing

15.2%

Other area(s)

4%

Do you think less businesses would fail if owners had more business education before starting up?

Yes

62.8%

No

37.2%

Which of the following statements do you agree with?

I knew everything I needed to when I first set up my business

20%

At times, I have lacked knowledge when it comes to financial and business planning.

47.6%

I would have appreciated more help when I first set up my business.

37.2%

I had no support when I first set up my business.

29.2%

I have made mistakes that have put my business at risk.

13.6%

I have made mistakes that have cost my business dear.

9.6%

I have made mistakes that have cost people their jobs.

2.8%

None of the above

5.2%

Do you believe cash flow problems is the number one reason that businesses fail?

Yes

41.6%

No

36%

I do not know

5.2%

Date Issued 14 July 2015.

Research

UK Start-Up Business owners calling for more education

According to research conducted by Just Cash Flow PLC.

Follow @justcashflowuk on Twitter for more like this.

What do business owners say? Hear it from them...

Just Cashflow Research

Just Cash Flow PLC, spoke to 250 small business owners.

On the radio, hear it now...

John Davies was featured on a variety of Radio stations including JazzFM's Business Breakfast, London Share Radio and Radio Yorkshire.

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