It's been a tough few years for businesses in the UK, especially new start-up enterprises trying to make their mark in an economy rocked by recession. 2014 could mark the start of a turnaround for Great British businesses.
After spending almost six years within the vice-like grip of a credit crunch, it would seem that the economy is experiencing a growth spurt that will see it get closer to a healthy "pre-recession" size.
A recent report by the Office for National Statistics confirms this by showing that the UK economy grew by 1.9% in 2013.
The effect of economic growth on businesses
Economic growth of any size is encouraging after years of austerity measures, and this latest increase puts the economy at its highest rate since 2007, which was the point just before the recession really took its hold in 2008.This suggests that the UK could potentially be on track to reach a full recovery if these levels are maintained with further growth ahead, which provide further security and growth potential for UK businesses.
Chancellor George Osborne has said that this increased figure is based on manufacturing growing ahead of some other sectors, which shows that the governments long-term plan for recovery and stability.
450,000 jobs were created in 2013 for Britons thanks to the expanding economy, and Osborne cites this as a reason why the UK is a great place to grow a business. He also claims that investors from across the world recognise this and are choosing to invest in the country.
Reaping the rewards of a refund
Businesses in Great Britain can also expect to benefit from fairer measures, overcharge repayments and more transparent practices on top of economic growth from this year and into the future.
One example is the scandal surrounding incorrectly sold Payment Protection Insurance (PPI). This first gained major attention in 2004 when former Liberal Democrat Treasury spokesman Vince Cable demanded an investigation into the aggressively sold premiums.
A decade on and refunds to customers that were sold the policies without their knowledge are continuing to climb - as of February 2014 the repayment bill from all banks is approaching £20 billion. This means that if someone sought a loan to support their enterprise, they may be eligible to claim a refund if they too were mis-sold PPI. This money could then be reinvested into a business or used to reduce monthly overheads.
It isn't just individuals reaping the refund benefits via a large lump sum, as businesses are also eligible to do so through different policies that were pushed onto them. In fact, Lloyds Banking Group confirmed that they would be setting aside an additional £130 million in 2014 relating to the sale of interest rate hedging products sold to SMEs.
Utilising the financial U-turn
This good news is surely sweet music to every business owners' ears especially following recent economic turbulence.
This turnaround shouldn't be dismissed as something shallow - whilst it means that business will benefit now, it also provides a more secure future which could have been shrouded in doubt only 12 months ago.
London-based business brokers Avondale state that a key step to increase the value of a business is to plan for future growth, which an improving economy allows for. Confirmation that economic recovery is taking place provides business owners with the confidence to continue in business or perhaps even try their hand at opening a new enterprise, driving forward future investments which supports further growth.
A stronger economy could also see businesses benefit from an increased revenue stream as the public begin to regain confidence in a dented market and start spending more. This in itself promises a stronger 2014 for businesses which will be integral to nurturing further development.
Whilst it may be too early to promise a complete recovery from recession, green shoots seem to be present.Suggest a correction