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How the pandemic is igniting the UK’s entrepreneurial spirit

How the pandemic is igniting the UK’s entrepreneurial spirit

The impact of the third national lockdown is taking its toll, and despite the end of the furlough scheme being pushed back to September, the UK is expected to face a record number of redundancies. 

Uncertainty caused by the rapidly changing nature of the pandemic, coupled with business debt built up over the last year, has created a perfect storm; data from the ONS shows that redundancies are rising at a higher rate than during the financial crisis of 2008.

Our normal working lives and routines have been completely disrupted, and trends that were being seen in the workplace pre-pandemic have been accelerated. Changes such as the increased shift to digital could result in 25% of workers globally (or 1 in 16) needing to switch occupations than before the pandemic.

However, following a recession or period of uncertainty, there often comes a time of innovation and change. The need to spark new ideas, collaborate and reassess, surfaces potential and encourages entrepreneurship. The alternative finance sector was born in the years following the 2008 recession, with crowdfunding and P2P lenders revolutionising the industry, extending finance to individuals and SMEs the banks refused to fund, keeping many businesses afloat.

Whilst undoubtedly a challenging time for many, despite the widespread uncertainty a sense of resilience has emerged, where those that have been able to embrace the dynamic nature of the situation, rather than trying to stop an inevitable tide of change, have found opportunity.

Now is the time for change

When furlough ends, some workers will be facing redundancy and looking to refocus their careers and learn new skills – launching new service offerings, building new platforms and generating opportunity.

This surge of productivity and innovation needs to be harnessed, and with small businesses accounting for 99% of all British business, their success is vital for the economy.

Setting up a new business is daunting, hard work, and the statistics around the failure of  start-ups make for glum reading. The number of new businesses continues to grow steadily year on year, but around 20% of those will unfortunately fail within their first year.

Lack of funds, the wrong market, poor research and bad marketing are some of the most common contributing factors to a new business failing,but with the right attitude, advice and support it is possible to side step the initial 12-18 months it takes for a new business to get going.

Kickstarting new opportunity

The contribution of franchising to the UK economy is growing, and now worth over £17bn, or 1% of UK GDP. The number of franchised units in the UK has grown to 48,600, the highest number ever, providing employment to an incredible 710,000 people.

The concept of franchising has more than doubled in the last twenty five years, and it’s easy to see why. Following the last recession and ensuing economic instability, many wanted to take control of their own destiny, and it is likely to be a trend that continues into the post pandemic world.

Although there are risks involved with starting any business, there are distinct advantages to a franchise over a traditional start-up model.

While an estimated half of all new businesses fail within 5 years, only 0.9% of franchised start-ups end in commercial failure – buying into a tried and tested business model removes many of the initial hurdles startups face, and ensures the business immediately sets out on the right foot. 

Having access to the established support network or community surrounding a franchise provides peace of mind and a way to learn new skills in areas that interest the individual. The idea of launching a business, “for yourself, not by yourself” is hugely appealing in the current climate, as we look for new possibilities and potential, but also a degree of certainty.

During the pandemic, working practices have changed, and for some it has identified the need for an improved work-life balance when ‘normality’ resumes. Many franchising systems can be operated from home, offering the freedom for a more balanced way of living – spending more time with family, whilst also running a successful business.

Franchise ownership should be an attractive option for many, offering a way to explore new business opportunities with a support network, and the ability to scale at a pace that suits the individual.

Perhaps this is the time to redefine how we want to work –  can we be leaner, agile, more dynamic? By looking forward rather than back, we can use this time as an opportunity to explore new possibilities and turn aspiration into reality. 

The UK Adviser

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