Venturing into the business world is a daunting experience at the best of times, but in terms of the UK landscape right now, it is perhaps more daunting than ever. Just three weeks ago, Lloyds Bank announced that confidence among British businesses had sunk from 25% in July to 16% in August, which is consequently the lowest it has been since March 2021.
Given the situation in the world one year ago, it is hard to compute how business confidence is even lower now that the world is going back to normal again. Essentially, companies are growing more nervous about rising prices rather than economic slowdown (which was the main concern throughout 2020 and 2021). With a vast range of economic challenges and inflation concerns intensifying, it is clear that the UK business world is on a dangerous teetering point going into 2023.
The question must then be asked, how can a start up look to get a hold of a market which is so full of anxiety? According to statistics taken before the current issue of inflation, 10% of start ups fail within the first year, with a further 60% falling in the first two through five years. Put simply: it is not easy to build and maintain a successful country, especially in the current climate, where even successful companies are feeling the pressure.
So Is It A Good Idea To Start A New Business In 2022?
With this being said, it is not all doom and gloom for modern-day business start ups. For example, any business start up worth its weight will know that data and analytics do not tell the whole story. For instance, whilst 10% of start ups fail in their first year, 42% of those start ups fail because there is no market need for their products or services.
Put simply, for any business to succeed, it is important to remain aware of the market and how the business fits into the current landscape. Basic practices must still be followed, including market awareness, reputation management, employee engagement, informative content, and more. There are still a number of ways start ups can succeed in these areas, with companies like percepto-digital.com able to ensure success will not be dictated by the failure of PR market management.
As well as this, although the current 16% confidence rate seems low, it’s important to remember that it is only a number. Whilst business confidence may be low, the demand for staff has held up and a number of firms have reported less concern about hiring and maintaining an employee base. Furthermore, at least 38% of businesses are expected to increase headcount over the course of 2023, with 26% considering raising pay. Of course, the current storm of inflation and energy costs is still something that justly causes concern, but there are areas of business success and development in the UK which can still be found.
So What Can Start Ups Do To Survive?
If a start up has a genuinely good business concept (not to mention a market which is likely to invest), then the business climate should never be the cause to pull the plug. The world and the business landscape is constantly changing, after all. Whilst this month is seeing low business confidence, there is nothing to say that confidence might be higher in a year’s time, meaning it’s not really about when a business is started but how it is done.
Just look at Yorkshire. Along with the rest of the UK, Yorkshire’s confidence has been on a successive decline over the last four months, yet, unlike the rest of the UK, its August confidence returned to growth. According to Steve Harris, who is a regional director for Lloyds Bank, the growth in Yorkshire’s confidence shows a positive response to pressures in the market, which has been made by adapting their propositions and focusing on the areas that have been the most profitable.
In short, so long as a business is sharp and proactive, there can always be an avenue to streamline focus and make profit, even if the landscape seems dire. That’s not to say that failed businesses have not done this, either. The business world is volatile and often unkind, but, critically, there are things companies can do to give themselves a chance to stay afloat amidst the turmoil.
Onwards And Upwards
For a business start up, technical assistance, a strong employee base, and widespread awareness of the market will be critical in its journey to survive. If it keeps its head in the game, then it will put itself in the best place possible to fight through the storm of inflation and come out on the other side.
As mentioned previously, nothing ever stays still in the business world. As long as a start up has the know-how and the aptitude for survival and success, there is no reason they won’t still be around when the sky begins to glow a little bit lighter.