One in Three of Europe's Small Businesses Plan to Expand in 2010
LONDON, April 28, 2010 /PRNewswire-FirstCall/ --
- But Warn That Government Bureaucracy Threatens Their Entrepreneurial Spirit
In a sign of renewed confidence among Europe's entrepreneurs, almost one in three (30%) small businesses are set for expansion in 2010 - with two thirds (63%) of those planning to go for growth during the second half of the year - according to new research published today.
The second 'DNA of an Entrepreneur' study* carried out by specialist insurer Hiscox among nearly 1,000 small business owners in the UK, Germany, France and the Netherlands, also found that three in five (58%) of those polled are optimistic about the year ahead.
With the recession now officially at an end, over half (53%) of those questioned believe 2010 is a good year to start up a small business with nearly a fifth (19%) pinpointing gaps in the market caused by company closures as a key opportunity to capitalise in the economic upturn.
Lack of support
But despite growing optimism, one in five (20%) SME bosses are concerned that there is not enough support for emerging small businesses. In fact, the majority (65%) believe that government bureaucracy is threatening their country's entrepreneurial sprit, identifying four major barriers to setting up on your own:
- Unfavourable taxation system (71%)
- Inflexible labour laws (63%)
- Burden of benefits and social security payments (58%)
- Lack of support from government (37%).
However, when it comes to nurturing future business talent the UK topped the poll - a third (31%) of UK SMEs say our education system encourages individual ideas and dreams, compared to just 19% in Germany.
Risky business
The study also found the recession impacting entrepreneurs' attitude to risk - just one in three (36%) small business owners say they are comfortable with taking risks compared to 40% at the time of the last study two years ago**.
Figures also point to a glaring disparity between countries when it comes to new ventures. Less than one in ten (8%) bosses in Germany accept the need to take a gamble when running their business compared to 38% in France and 29% in the Netherlands and the UK.
As the most risk averse of Europe's SME bosses, over a third (37%) of those polled in Germany admitted they would prefer to run their business without having to take any chances. In contrast, just 11% from France and 15% from the Netherlands and the UK said the same.
Alan Thomas, small business expert at Hiscox comments: "The SME sector is a strong bellwether for the rest of the economy so it's a great sign that Europe's entrepreneurs believe they are now in a sound financial position and well placed for growth in the second half of 2010, despite being more risk averse.
"But small businesses cannot lead the charge alone. The tough economic climate of the last two years has left many in a delicate position so it's vital that the right support is provided to breakdown any barriers threatening Europe's future entrepreneurial success."
The DNA of Europe's Entrepreneurs
UK Germany France Netherlands
Future optimism
% planning expansion during the
first half of 2010 9% 10% 21% 5%
% planning expansion during
second half of 2010 16% 20% 28% 14%
% optimistic about year ahead 55% 61% 51% 68%
% believe 2010 is a good time to
start a business 50% 49% 53% 59%
% recognise opportunities caused
by gaps in the market from
company closures 14% 19% 20% 26%
Support for SMEs
% believe there is not enough
support for SMEs 32% 54% 37% 28%
% who think that government 59% 73% 64% 66%
bureaucracy is threatening
entrepreneurial spirit, due to:
- Unfavourable taxation system 74% 71% 74% 63%
- Inflexible labour laws 55% 65% 73% 66%
- Burden of benefits and social
security payments 49% 66% 69% 56%
- Lack of support from
government 32% 54% 37% 28%
% believe that their country's
education system encourages
individual ideas and dreams
Attitude to risk 31% 19% 28% 24%
% comfortable with taking risks 39% 33% 37% 34%
% accept the need to take a
gamble when running their
business 29% 8% 38% 29%
% prefer to run their business
without having to take any
chances 15% 37% 11% 15%
Notes to editors
* Research conducted by The Survey Shop on behalf of Hiscox among 970 SME bosses of companies with less than 50 employees in the UK, Germany, France and the Netherlands between 19th and 25thFebruary 2010.
** Research conducted by The Survey Shop on behalf of Hiscox among 1,150 SME bosses in the US, Holland, Germany, France and the UK between 27th May and 27th June 2008.
About Hiscox
Hiscox, the international specialist insurer, is headquartered in Bermuda and listed on the London Stock Exchange (LSE:HSX). There are three main underwriting parts of the Group - Hiscox London Market, Hiscox UK and Europe and Hiscox International. Hiscox London Market underwrites internationally traded business in the London Market - generally large or complex business which needs to be shared with other insurers or needs the international licences of Lloyd's. Hiscox UK and Hiscox Europe offer a range of specialist insurance for professionals and business customers, as well as high net worth individuals. Hiscox International includes operations in Bermuda, Guernsey and USA. Hiscox Insurance Company Limited, Hiscox Underwriting Ltd, Hiscox Europe Underwriting Ltd and Hiscox Syndicates Limited are authorised and regulated by the Financial Services Authority.
For further information, visit http://www.hiscox.com
SOURCE Hiscox
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