The UK needs to be less London-centric » SMEInsider

The UK needs to be less London-centric

SME owners are tired of small businesses being concentrated around London, so a new study proposes that a ‘small business hub’ be created in another major UK city.

Investment banking firm AXA UK have conducted a study entitled Driving local business growth: Creating an ‘SME hub,’ which took into account the views and opinions of over 400 small business owners.

The results showed an overwhelming feeling of cynicism towards the political system.

SME owners feel that the political landscape is too London centric and that the creation of an SME hub outside of London would  grant small businesses access to shared resources, assets and logistics.

‘‘Our research highlights the growing concerns SMEs have about the lopsided development of our national economy. If the Government is serious about supporting SMEs, and it truly believes that SMEs are the lifeblood of our economy, then I encourage it to show its support in real terms,’’ said Amanda Blanc, CEO of AXA’s commercial business.

Within the survey, 71 per cent of SME owners say the concentration of businesses in London represents a risk to the economy, with almost a third (30 per cent) rating this risk as “significant”.

‘‘One way of addressing this pressing issue is the creation of an SME hub – but what would it look like? Our report shows there is a critical need for legal, financial and regulatory advice and a more structured model to access funding so the hub could take the form of a ‘national business advice centre,’’ continued Blanc.

An overwhelming 89 per cent of SME Directors state that the creation of an SME hub would be beneficial to the UK economy, with a third (31 per cent) saying it would be “extremely beneficial”. Interestingly there is no clear North-South divide on this issue, with 84 per cent of South East-based SMEs agreeing that a non-London-based SME hub would be beneficial to the UK economy.

‘‘It’s clear from what these SME leaders have told us, across the country, that there is widespread fear the economy is not only unbalanced in favour of London but that businesses operating outside the capital are at a competitive disadvantage,’’ ended Amanda Blanc.

If there was to be another SME hub outside of London, small business owners have sounded out two possible locations. Birmingham topped the survey with 27 per cent of applicants preferring the Midlands, whereas 26 per cent of applicants chose Manchester as their favourite site.

Last week SME insider reported that Anna Soubry had become the new minister for small businesses. In the report, AXA commented on what she should focus on:

‘‘Anna Soubry MP should ensure the issue gets a sufficient share of voice in Westminster. Anna Soubry would ideally become the face of regional SME growth. Lobbyist organisations such as the Federation of Small Businesses (FSB) and the Confederation of British Industry (CBI), will need to lend their voices to the debate and should be encouraged to do so,’’ said the report.