March 2012

UK is the ‘most internet-based major economy’

A recent study by Boston Consulting Group (BCG) suggests that the internet contributes 8.3% of the UK economy – a bigger share than for any other G20 major country.

The internet generated £121bn of income in 2010 – a value worth £2000 per person. This value exceeds equivalent figures for either the healthcare, education or construction sectors.

Furthermore, the UK carries out more online retail than any other major economy. 13.5% of all purchases in 2010 were carried out over the internet and according to BCG this figure could rise to 23% by 2016. BCG also project that by 2016 the total generated income through the internet will reach £221bn – This represents a rate of growth of 11% per year. Projected future growth rates for China and the US are 5.4% and 6.9% respectively.

The research goes on to explain that there is a clear indication of the UK public’s growing affection towards the internet with some 65% of people saying they would give up alcohol to maintain their broadband connection. This is clearly good news for both UK SMEs involved in the Internet sector and also investors into UK Internet based ventures. Hopefully this will make it easier for Internet based SMEs in the UK to attract the funding finance they need in future years.

P2P lending

Banks not lending? Need to borrow a relatively small amount, say £10k-£100k? Then you could try P2P (peer-to-peer) lending, which allows individuals to lend directly to businesses. Some of the most famous P2P marketplaces include Zopa, Funding Circle and Thin Cats.

But what if you need larger amounts? Well, help may be on its way. The government has suggested the creation of an agency that would bundle together small business loans. This would presumably not only increase the amounts available for companies to borrow, but also attract the attention of private investors who may see this as a profitable activity.

Winning Government Grants: What You Need To Know

If you’re currently looking for grants then you’ll know that they’re rather hard to find and secure at the moment. Luckily, help is at hand! Smallbusiness.co.uk have recently launched a new iPad and iPhone application which features case studies of businesses that successfully achieved a grant, along with a list of the 118 assistance schemes available to those in business and starting up – powered by businessfunding.co.uk.

To find out how this guide could benefit you, take a look at the guide’s introduction.

The guide costs only £2.49 and is available to download now for your iPad or iPhone.

Don’t have an iPhone or iPad? No problem! The guide is also available to order in PDF format.

3 Quick and Effective ways to Improve your Business:

Here at Businessfunding.co.uk we’re all about business funding. However, whether you need funding or not it’s always worth also checking out your costs. We have been thinking about very easy ways for business owners to save money and thought we’d share these three ideas.

  • Businesses should always ensure they are operating out of an appropriate office space. An ‘appropriate office space’ is dependent on the size of the business, the sector it operates in and the services it provides. For example, an international consulting company may need a much larger and more impressive office space than an SME that produces software. Many factors need to be considered when choosing an office space but above all it must be cost effective. Take a look around where you are now – is it really suitable? Could you cope with a smaller space, or perhaps one further out of town and therefore cheaper? Moving is a pain but costs are painful too! 
  • You should always negotiate any contract relating to a variable cost. The objective in business is to make as much sustainable profit as possible. As business owners know, it is often very difficult to increase revenue. Instead of concentrating all their efforts on this, businesses should make sure that they are maximizing their returns by minimizing their costs. For a Tech Startup this may mean buying any electrical components used in the manufacture of their product at the lowest possible price, or paying the lowest possible fee for any services that have been outsourced, e.g. accountancy services.
  • Finally, a bit like your personal finances, take a look at your debt. Businesses can improve their ultimate likelihood of success by ensuring that they have no credit card bad credit or other outstanding interest bearing debts. Minimizing debts early on can pay dividends down the line and prevent your business getting stuck in a vicious circle!