Why is mentoring small, medium and micro enterprises important in achieving UK growth?
Small, medium and micro enterprises are the engine of the UK economy, and their success is essential to our economic prosperity.
They drive economic growth by stimulating innovation, creating a competitive spur to existing business to increase their productivity. Successful and growing enterprises mean more opportunities, a more dynamic local economy. This leads to more jobs, more suppliers & more customers for us all.
- 99.9% of UK firms are SMEs
- They employ 14.4m people, which is over half of the total private sector workforce
- These enterprises have a combined annual turnover of £1,600bn – just under half of private sector turnover
The Government has made a commitment to deliver long term, sustainable economic growth and one of its key priorities is to ensure it creates the conditions for more businesses to grow. In order for this to fully work and achieve UK success the skills and expertise of the private sector are really needed.
Government’s vision for enterprise mentoring in the UK is for a vibrant, effective and sustainable mentoring network that is accessible to all and supports both start-up and established small and micro businesses locally, helping them to grow.
What is Enterprise Mentoring?
There are many definitions of enterprise mentoring, but a straightforward one is “an experienced person acting as a sounding board and critical friend to help someone develop their abilities to run a business” (SFEDI 2014)
It is not advice and giving advice contravenes the national code of practice, as the end goal is to support the mentee in being confident in achieving business success on their terms.
Current research key points
Research proves that SMEs that use external support have a greater chance of survival and success.
- The 2013 Small Business Survey found use of a mentor by all SMEs at 12%. (England only)
- However, the same survey shows that a further 21% of SMEs would be interested in using a mentor.
BIS Small Business Survey 2013, SME employers who sought external support and guidance in the last 12 months were more likely to be growing with;
- 67% aiming to grow their business over the next 12 months
- 21% more likely to have grown their workforce in the past year (compared to 14% of SME employers who had not sought support)
- 34% more likely to be expecting to grow their employment in the next year (compared to 29%)
- 32% more likely to have increased their turnover in the past year (compared to 24%) and 30% more likely to be expecting to increase their turnover in the next year (47%, compared to 36%).
- 62% expect to increase their online presence over the next 12 months
Encouraging small business owners to recognise the benefits of looking outside for information and support is therefore key.
For many small businesses, using a mentor can also be the first step towards making use of other external support to help their business grow.