POLICYMAKERS must do more to find out what makes Britain’s small businesses tick, according to a new study.
Leeds-based brand consultancy Propaganda has helped to compile a report for the Management Consultancies Association (MCA) Think Tank, which calls for further segmentation when categorising SMEs.
The report argues that businesses with a diverse range of products, services, staffing number and challenges, are being grouped together under one banner simply for convenience.
The report highlights the fact that the term ‘SME’ can cover any business from start-ups and one-man-bands, right through to regionally significant manufacturers, employing 200 people.
The report suggests that the Government “should attempt a more thorough segmentation of the SME landscape. This would help to ensure its growth interventions, as well as potentially everything from tax to regulatory policy, are suitably adapted to the needs of its targets.”
The report recognises the importance of SMEs to UK plc, but also cautions that some, often at the smaller end of the spectrum, legitimately, aren’t seeking growth.
As a result, Government policy could be better targeted to understand and support the aspirations of SMEs and business owners.
Kirsty Birks, director at Propaganda said: “Middle-sized, owner-managed firms, are well placed to innovate.
“With digital systems reducing the costs of risk-taking, they are able to move more quickly and more cheaply than before and are unconstrained by the governance structures of large PLCs. These owner managers understand the relationship between their actions, image and brand.”