HAPPINESS comes before cash for the majority of small business owners in Guernsey, says Tony Brassell of the Guernsey Enterprise Agency. He said making vast sums of money was rarely high on the agenda for local entrepreneurs.
According to the Age of the Entrepreneur Report, which has just been published by Kingston University and T-Mobile, 63% of small-business founders said being their own boss was the core reason for setting up a company.
Mr Brassell said he wasn’t surprised.
‘Most people like the idea of being their own boss and we often have to broach the subject of money and how they can make a living out of their business because they haven’t really given it much thought,’ he said.
Having no one to answer to was followed by achieving a better work-life balance, this being highlighted by 46% of respondents, and dissatisfaction or boredom in working for a previous employer was the reason for 37% to go it alone.
Money came fourth with 36% and just 4% of respondents said making a million pounds or more was their main aim.
Mr Brassell said in his experience, the work-life balance was a prime mover for potential entrepreneurs.
‘Many people have a family and want to be able to work from home or tailor their hours to meet the time they have available.
‘But, as everyone knows, cash is king in business and perhaps the fact that money is not the highest priority can explain the high level of start-up failures in the UK if people don’t properly consider how they are going to make money.
‘I have seen very few people who plan to make a million out of their business. However, we always try to ensure people look beyond the immediate future and structure their business to enable them to cash in all their hard work at some point in the future.’
Speaking about the UK, Kingston University’s Professor Robert Blackburn said the report indicated that the government should be wary of putting small businesses on a pedestal as the future growth-engine of the economy.
In Guernsey, Mr Brassell said, small business played a fundamental role in the island’s economy.
‘In UK terms, the vast majority of businesses in Guernsey fall into the category of small- or medium-sized enterprises,’ he said.
‘A large percentage of the population is either self-employed or working for a business with fewer than 10 staff. These companies support the larger ones by providing products or services which ensure the larger ones can function.
‘However, without doubt, the larger businesses drive the economy and contribute the funds, through taxation and salaries, which enable the local economy to thrive.’
The GEA would like to see more small businesses, but with full employment the States has a delicate balancing act to perform, added Mr Brassell.
‘If they encourage too many new businesses, whether small or otherwise, larger companies will struggle to find staff.
‘However, if people aren’t able to start up and don’t get advice on the best way to do it, you face the potential for people to either lose money by starting up in ill-advised enterprises or spending a lifetime of frustration working for someone and never having
the chance of being their own boss.
‘We mustn’t forget that even Specsavers was a small business once. Without start-ups, you lose the chance of anyone ever growing a business into a large enterprise capable of providing the type of income the government is after.’
The GEA’s work often involves trying to dissuade people from starting up businesses that have no hope of success, added Mr Brassell.
‘We would always prefer to be involved right at the start rather than coming in after all the commitments have been made.
‘And as advisors, we all enjoy nothing better than following through the creation of a business from conception to profit.’
* For help in starting a business, call the agency on 710043 or visit www.gea.gg.
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