More than 360,000 small businesses plan to cease trading within five years
Some 363,000 small business owners plan to cease trading in the next five years, potentially putting more than 1.4 million jobs at risk, according to new research.
The study for Bizdaq, conducted by Opinium, also revealed that an additional 510,000 business owners have plans to sell up in the same time period.
Based on the average small business employing four people, it means that a significant number of jobs could potentially be under threat.
It is estimated that around 529,000 of the jobs at risk could disappear in the next 12 months, as the longevity of businesses is called into question.
The study found that uncertainty and fears around Brexit negotiations have led to 35% of young entrepreneurs – those aged between 18 and 34 – closing their businesses.
It was a different story among the older generations though, as just 9% of 35-54 year olds and 3% of those aged over 55 were planning to close as a result of Brexit uncertainty.
Nearly two thirds of SME owners said that their business had stagnated, or that they had been forced to downsize, since the last election, recording no or negative growth.
Businesses facing constant losses and negative growth can face bad debts and even insolvency in severe instances, as they lack the finances to overcome the issues they face.
Any business facing financial difficulties should seek advice from corporate recovery specialists at the first opportunity to ensure they stand the best chance of finding appropriate solutions that can keep them trading.
Those in the North East are most likely to close their business in the next five years, with 29% of business owners in the region planning to close.
That figure compares favourably to the West Midlands, where only 14% are considering closing their businesses – the lowest proportion in the UK.
The research also called for greater assistance from the government to ensure that small businesses receive the advice they need.
By Phil Smith