Newspaper article The Journal (Newcastle, England)

Time to Scale Up the Best of Our Our Small Firms

Newspaper article The Journal (Newcastle, England)

Time to Scale Up the Best of Our Our Small Firms

Article excerpt

Byline: A VIEW FROM BARRY JACKSON, BGF BUSINESS VOICE

DO you work for an SME? If you work in the UK, the answer is most likely yes. Defined as "an independent firm which employs fewer than 250 people", small and medium-sized enterprises are the backbone of the economy. There are over five million of these firms in the UK, employing over 60% of the private sector and generating overall sales of PS480bn.

Clearly, SMEs are no small matter - politicians, the investment community and even big businesses (rightfully) praise them for their innovation, hard work and entrepreneurship.

The need to provide support to the SME community has been the topic of countless discussions, forums, breakfast briefings and policy papers. How much has converted into meaningful action is hard to say.

While SME is a powerful entity, it has always lacked a unified, authoritative voice - because not all SMEs are the same.

The term is used to cover everyone from a freelance designer to the local florist, from a family-owned construction firm to a tech start-up hoping to become the next Google. This lumping together, under one term, ignores the differences between SMEs and the distinct challenges they face. By better respecting the differences, we can better understand how they can be supported.

For example, we need to recognise that there is a critically important small group of fast-growing, highpotential companies that are creating jobs and wealth faster than any others. These are businesses that could have a major impact on their local area and, ultimately, the national economy.

It is time that these businesses had their own name - the Germans call them "Mittelstand", although I'm not too sure this will catch on around Tyneside.

I prefer the term "scale-up" - it sounds as ambitious as the entrepreneurs themselves and describes exactly what these companies are doing. A scale-up is a business that is demonstrating genuine growth in terms of sales and people. …

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