Press Room

Small Firms Look Beyond Their Local Community
(03 May 2005)

Small businesses in the UK feel less part of their local communities than ever before, according to the NatWest/ SERTeam Quarterly Survey of Small Businesses. In the days of internet based working, long commutes and far flung distribution deals across the world, a fifth of businesses admit to concentrating further afield than their local community.

Smaller companies, in particular one person bands, feel less part of their local community (72%) than their larger counterparts with 20 of more employees (46%). Wholesalers (38%) and transport/ travel firms (29%) are much more likely to focus their efforts further afield, where as 90% of hotels and restaurants, who deal directly with local consumers, tend to feel closer to the local community.

Paying local charges, such as Council Tax, is the main reason why firms do feel involved in the community, however over half also create employment for local residents and 41% support local charities and community events.

Although social responsibility is high on the agenda of the UK's large corporate businesses, more than one quarter (26%) of small firms felt that it was not an issue that was relevant to their business. Far fewer (16%) thought that smaller companies needed to be more socially responsible.

Government regulations and the paperwork that they create remain the number one issue for small businesses. In the last quarter, the percentage of small businesses reporting that the impact of government regulations was their top problem, rose from 13% to 20%. It has now been the top ranked problem for over a year. Pete Ferns, Director of NatWest Business Banking, said: "It seems that the stereotypical small business operating in the local community for the local community, is no more. Nowadays, entrepreneurs look further afield for business and the Internet has opened up a world of opportunity for them to operate across the globe.

"It is clear that whilst many businesses feel that they are socially responsible already, a large number do not think that issues in the local community are of relevance to them."

Notes to Editors:

  • The NatWest SERTeam Quarterly Survey of Small Business in Britain is carried out by the Small Enterprise Research Team, an independent charity based at the Open University Business School.
  • Copies of this and previous surveys are available at a cost of £40 each or £120 for one year's subscription from Small Enterprise Research Team (SERT), Open University Business School, Walton Hall, Milton Keynes, MK7 6AA. Tel: 01908 655831.
  • Small businesses wishing to participate in this survey, should telephone 01908 655831 or complete the survey online on www.serteam.co.uk. There is a free copy of a summary of the survey findings for those completing the questionnaire.