Just 54% of New Businesses Become Profitable Within 2 Years
A new report by SumUp has found that just 54% of new businesses make a profit within the first two years of starting up.
As we highlighted in a recent article, 85% of workers would like to start and build their own business.
The survey by SumUp into new businesses, which involved conducting interviews with 540 entrepreneurs back in April 2022, also found the following:-
- Those new businesses which attained profitability in the shortest period of time, were those in the transport and travel sector. 23% became profitable within the first year of starting out, whilst 100% had turned a profit within 3 years. One reason for this finding is that during the recent Covid-19 lockdowns, there was a boom for the transport sector in terms of delivering online shopping orders
- The new businesses which struggled the most to make a profit were those in the telecoms and IT sector. Just 2% were profitable in their first year. Nevertheless, by the end of the 3rd year, 83% had moved into profit. The reason for this is that the start up costs in terms of equiping and resourcing these type of new businesses is considerable
- In terms of the initial investment by the owners of new businesses, most (34%) invested between £10,000.00 - £24,999.00
- Time management was cited as the biggest problem in starting new businessess by the entrepreneurs, with mental health problems also an issue amongst the owners of smaller new start ups
- In terms of the most enjoyable aspects of running new businesses, 42% of entrepreneurs cited being their own boss as the main one. Other benefits cited were growth (31%), creativity (26%), chossing your own hours of work (22%), and financial freedom (20%)
Nevertheless, starting up new businesses is not easy. Government statistics show that there are around 500,000 – 700,000 new start-up businesses on average each year. According to Fundsquire, however, “20% of businesses fail in their first year and around 60% will go bust within their first three years.” According to CBInsights, the main reason why new businesses fail is the very bitter truth that there is no market for what they are trying to sell (42%). The second most common reason for business failure is cash flow (29%).
The Co-founder / executive manager of Charter Capital, Gregory Brown, points out that one very common mistake business owners make is to place too much focus on profitability and growth, and not enough on cash flow.
65% of Employers Provide No Menopausal Support
A new survey conducted by WorkNest has found that 65% of employers provide no menopausal support to their employees, with 68% of line managers having no knowledge of the legal ramifications in terms of managing those going through the menopause, and 13% not comfortable with handling menopausal related issues.
Jane Hallas, The Head of Team and a Solicitor at WorkNest, stated: "It’s concerning to see that most managers are unaware of the legal risks associated with menopause. If organisations don’t understand the legal risks, it won’t be long before they fail to provide the appropriate support to staff managing menopause. This could result in a grievance for being discriminatory or, even worse, taken to an employment tribunal....An employee suffering from menopause who fails to receive appropriate support could risk sex, age or disability discrimination claims. There are also risks around constructive and unfair dismissal claims if employees are not supported appropriately."
As we highlighted in a recent article, the parliamentary Women and Equalities Committee recently released a new report entitled ‘Menopause and the Workplace’, in which it calls for the menopause to be added to the list of protected characteristics.
The Committee stated in their report that they are “persuaded that a new protected characteristic of menopause should be created.” The Committee chair, Caroline Nokes, added that: “The omission of menopause as a protected characteristic under the Equality Act is no longer tenable, given that 51% of the population will experience menopause. We were shocked to hear that many women have to demonstrate their menopausal symptoms amount to a disability, to get redress. Our Committee is calling on the Government to make menopause a protected characteristic in its own right.“
