05/08/2010
Rising unemployment will encourage a record number of people to start their own business this year, according to The Federation of Small Businesses.
As reported by MSN News, the FSB said that 300,000 people will become their own boss, simultaneously creating new jobs and giving a boost to the economy.
Whilst many of these people will undoubtedly pump savings into launching their new business ventures, other sources of funding such as sales finance, which pays an advance on invoices issued to clients, are expected to rise in demand as businesses look for alternatives to traditional loans.
FSB chairman John Walker said: "Unemployment continues to be a worry for everyone, and this year we are expecting more people to become their own boss and go it alone by setting up in business, which will both help the economy grow and tackle unemployment as these businesses flourish."
A column published in The Financial Times explained that every autumn there are a flood of new entrepreneurs "keen to go it alone after making plans on their summer holidays.'' Mike Southon writes in his column that the most difficult part of starting a business comes down to sales, which run the risk of drying up. This is a typical scenario of when a business will turn to sales finance to free up some cash, tied up in an invoice issued to a customer, so they use the money to pitch for new business.
The article claims that this year will be different because there will be an unusually high number of public sector workers taking the leap of faith.
Laura Nineham