AUTUMN 2022 BUSINESS SUPPORT Council leaders Local authorities have a key role to play in helping small businesses to thrive Improving access to skills training and skilled people unlocks doors for business, and allows productivity to increase Small and medium-sized enterprises (SMEs) are vital to local growth, especially post-pandemic, but they face many challenges from skills gaps to increasing costs and high levels of debt acquired during the COVID lockdowns. Yet there are also opportunities. Ambitions to level up areas of the UK must have small businesses at their core, with local and combined authorities working with firms to ensure tangible and long-lasting impacts and results. Firms must be able to communicate with councils when decisions are being made and access services that they need quickly and easily. Good business engagement also means strategic planning is more reflective of the issues in a local area. Credit: Karen Woolley, development manager for Federation of Small Businesses Images: iStock / Alexey Yaremenko / VectorCookies / FARBAI / bounward / kadirkaba / Hiranmay Baidya / lushik / Tasha Vector / Tanya St / Barks_japan / kadirkaba SMEs: Facts and figures n SMEs account for 99.9% of the UK business population (5.6 million businesses) n Three-fifths of UK private sector employment, and around half of the turnover, is generated by SMEs n SMEs employ 16.3m people (61% of the UK working population), while their turnover is estimated at 2.3tn (52%) n Small businesses (0-49 employees) employ 12.9m people (48%), with a turnover of 1.6tn (36%) With this in mind, the Federation of Small Businesses (FSB) has issued its Local leadership report, which offers advice and guidance to local authorities on engaging with small businesses. It is aimed at elected representatives of major parties and officers, who are making and implementing policies at district, borough, county, city and combined authority level. Some of the challenges identified in the report are: Skills: Employers are struggling to recruit the people they need, and are facing skills shortages particularly digital and technical skills an ageing workforce, and a brain drain from some areas of the UK. Improving access to skills training and skilled people unlocks doors for business, and allows productivity to increase. Procurement: Doing business locally helps support small firms and is often better value for money: for every 1 spent with SMEs in a local community, 63p is re-spent in the area. In the past three years, 80% of small businesses have also contributed to their local community or charity, with 38% donating time and 32% contributing skills. Local authorities have huge purchasing power, which can be used to empower small businesses in their area and deliver for their communities. Parking: Enhancing parking availability would make one of the biggest differences to the UKs high streets, according to 70% of small businesses. No two high streets are the same, however, so the starting point for parking policy and management strategy must be local knowledge. Shops and services are often the reason people travel to an area, so it makes sense to include business owners in shaping current and future parking policy. Planning: Whether it is change of use, improvements to premises, creation of storage facilities, or availability of commercial premises, planning requirements are consistently identified as a major barrier to small firms development. Recent changes in planning have granted more flexibility to businesses and local authorities must encourage them to diversify their offering to the public. Business rates: Paid before a penny in profit is made, and subject to complex sometimes incorrect valuation assessments, business rates often feel like an impenetrable problem to small firms. However, the background information held by local authorities is key to helping businesses navigate these difficulties and to the process of issuing reliefs if needed. Town centres and tourism: 62% of small businesses in the sector are concerned about the decline of their local high street. Although new initiatives are beginning to reinvigorate many areas, bold, sustained action is needed to support new uses for our town centres, encourage entrepreneurs, and prompt the public to shop local. Net zero: Reducing our impact on the environment is vital; 56% of small businesses believe the planet is already facing a climate crisis, and most have taken positive actions yet only 36% have made a plan to combat climate change. They need help and guidance from their local authorities to do so. Regulation: Small businesses want to see a reduction in unnecessary red tape and for regulations to be easier to navigate. Digital connectivity: Many firms are pivoting their business model from face-to-face custom and adapting to a hybrid, or fully online, model. However, more than a quarter (26%) say they have lost sales or business because of poor broadband or mobile coverage, with 45% experiencing unreliable voice connectivity. Business support: Local and combined authorities, Local Enterprise Partnerships and Growth Hubs can help local businesses access the support, finance and services they need to survive, thrive and grow. By working together, firms are empowered to accelerate their business plans, and deliver not just for themselves, but for local communities and economies, too. For further information, please contact your local Trading Standards Service