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Perhaps controversially, I believe that too much emphasis and, indeed, money is spent on encouraging people to start their own business. In my opinion, resources should be restructured to offer more help to people once they have actually taken the plunge. 

I believe people should be shown that business is a genuine career option, and I am a strong advocate of Young Enterprise. But I’ve seen too much money wasted on national campaigns encouraging Joe Bloggs to start a business while someone who has a great small business cannot get to the next stage because of unnecessary barriers.

A prime example of a product which should help but which doesn’t is the Government’s Small Firms Loan Guarantee (SFLG). The idea behind this is that the Government covers some of the risk of the loan in order to allow banks to lend more easily to small businesses.

This was re-launched last year as the Enterprise Finance Guarantee Scheme and the Labour Party’s manifesto tells us it has helped 9,000 businesses. Writing as someone who has first-hand experience of the SFLG, I can tell you that if I was to start the process over again, I certainly wouldn’t bother. In the end we gave over so many of our own guarantees that the entire point was lost; despite whatever their PR says, the banks are simply not ready and willing to lend on this scheme.

In a nation of more than 60 million, 9,000 people on this scheme is not a claim to fame but an admission of failure. The figure should be tenfold. The Government needs to seriously and quickly address this issue and they should not be putting forward a scheme which the banks may or may not promote. They should be telling the banks that if a business comes in and meets a set of criteria, then they must allow them finance under a scheme where the risk of the loan is partially covered by the Government itself.

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    Small Business 2.0 was held on Saturday 23 January. Now in its second year, it’s an event dedicated to helping small businesses profit from the web. Emma Jones went along and picked up some useful nuggets.

    Business at the weekend

    One of the reasons I like the Small Business 2.0 event is that it’s held on Saturday. Not only does this mean it’s accessible to 5 to 9ers (those holding down a day job and building the business at nights and weekends) it also means there’s a relaxed feeling about the place as attendees listen, learn, and meet new people in an informal setting.

    These ingredients came together well on Saturday and were the recipe for an interesting and enjoyable day. Here are a few things I picked up:

    • A bit of trivia – the first item ever sold on eBay UK was a Scorpions CD at the price of £2.89. 
    • eBay has more than 17 million monthly unique visitors and offers more than 15 million items for sale. There are 123,000 full time eBay businesses, generating more than £1.7 billion per year in turnover. To date, $600million worth of business has been driven through the eBay iPhone application. The company expect this to become an even more popular way to shop. 
    • E-commerce continues to climb: the numbers of people shopping online – and the amounts they are spending – is increasing at a rapid rate. So it’s still a very good time to be starting an online trading business.
    • Customers are becoming more demanding: the majority of customers expect their online shopping experience to be as good as, if not better, than an offline shopping experience, placing the onus on the store owner to make it as simple and enjoyable as possible. 
    • The secrets to success in creating a successful online venture can be summed up as having:

    – Great products
    – Competitive prices
    – Outstanding service
    – Giving something back (eBay report that even though sellers participating in eBay for charity give 10 per cent of the sales price to charity, their products are 20 per cent more likely to sell, at a better price. This resulted in $50 million being raised for charity in 2009).

    • Enterprise is alive and well: I met a number of people in the early stages of starting a business, from Domino Duhan who is soon to launch Flog.com as a place to create a free online store, to Steven and Zoe who travelled from Worcestershire to pick up tips for their new venture selling cottage gifts.

    Altogether, there was a great vibe and positive signs that 2010 will be another exciting year for anyone starting and growing an online business.

    Emma Jones is the founder of Enterprise Nation and author of ‘Spare Room Start Up – how to start a business from home’. Her next book ‘Working 5 to 9 – how to start a business in your spare time’ will be published in May 2010.

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