How to get the smallest businesses online?

Getting Small Business Online

There are around 4m self-employed and micro enterprises in the UK, it is a sector that has grown rapidly and now accounts for 76% of all UK businesses. These businesses have the most to gain from getting online and we have many notable success stories in the UK’s vibrant digital economy. But this section of the business community also includes many who have not yet realised the value of having an online presence – often those in manual skilled trades.

The structure of the UK economy is changing; shifting towards a greater intensity of micro-businesses and SME’s, and it is increasingly important to ensure that these businesses are well-supported. Micro-businesses and SMEs are the most exposed sector to sub-standard communications services and the challenges presented by the UK’s growing digital skills gap, yet stand to gain the most from the transformative effects of the Internet.

On Thursday 9th July, Pictfor hosted a breakfast briefing for parliamentarians titled “The Missing Micros: How to get the smallest businesses online”. The briefing was held in partnership with Nominet, the .uk domain name registry which provides the online addresses to over 3m small businesses in the UK. The session identified the type of businesses that are being left behind and highlighted what could be done to help them get the most out of the modern economy.

Despite driving 10% of UK GDP, one third of small businesses are not online in any way. Furthermore, out of those that are online, only one third have a payments capability. UK Plc stands to benefit considerably if more SME’s are able to seize the opportunities afforded by an online presence; there is an estimated £18bn opportunity from increased digital activity in SME’s.

However, before this advantage can be unlocked, a number of significant barriers must be overcome. The impediments to SME’s getting online include skills, time, cost, infrastructure and perceived value. Small businesses that are unable to access business grade broadband connectivity are being held back as they may be unable to effectively process online payments, operate and manage websites, or communicate with customers on digital platforms.

Whilst some micro-business and SME owners may be appropriately skilled as basic users of smart phones and other consumer technology, they may not have the time to set up and manage a website. Those with full order books and an established local presence may struggle to see the value of an online presence, and it is especially crucial to communicate the value to these businesses. There is a general reluctance amongst some businesses to take the next step in terms of size, scope, recruitment or exporting, but it is in supporting these kind of transitions that the benefits of an online presence are clearest.

Government and industry need to work collaboratively to help micro-businesses and SME’s reap the rewards of the digital economy. These businesses must be helped to develop the infrastructure, skills and understanding required to establish an online presence and realise their commercial potential.

If you would like further information on this topic or about Pictfor’s programme of events, please contact admin@pictfor.org.uk.

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