A recent study has uncovered that many small-to-medium-sized enterprises (SMEs) launched with under £6,000 in funding and struggled with their budgets during their first few years.
The research surveyed 500 SME owners and was undertaken on behalf of Santander UK as part of the Spanish-owned British bank’s celebrations for its X Awards aimed at small businesses. Since the programme was founded in 2010, it has supplied more than £1.1 million worth of funding to support thousands of enterprises across the country.
Commenting on the X Awards and small businesses, CEO for Santander UK, Mike Regnier, said that new businesses play a crucial role by stimulating innovation and growth in the UK, attracting investment, creating jobs and enhancing productivity.
SME business loans are an invaluable resource for companies in their early years, but also for those planning to expand. For firms getting off the ground they can provide working capital and a float for seasonal slowdowns and the ability to purchase much-needed equipment. Later-stage companies often find they are instrumental for purchasing new premises and hiring more specialist staff to grow their operation and the services they can supply.
The survey discovered that 80% of respondents felt they had walked a financial tightrope in the beginning of their business, with 37% only breaking even after trading for three years. A total of 45%of business owners underestimated the funds they would require for their firm to launch and start operating, with 85% applying for more financial support and funding.
