More than two-thirds of sole traders in the UK are content with running their small business as it is, new research has found.
According to a survey by Xero some 70% have little desire to grow their business into a larger one. The company’s business research platform was used to survey 1000 UK-based sole traders and 62% stated that keeping things small was the way to go. Central to the appeal for small business owners is the ability to be your own boss, with 54% stating this was a key issue.
A further 40% highlighted how sole trader status allowed them to run their business to suit their lifestyle. Simply being able to control things and make decisions off your own back was the highlight for 31%.
Despite the challenges presented by running your own business, including having to deal with tax returns and accounting duties involved, sole traders said they loved the option of flexible working. Some 49% stated they were enjoying the independence afforded by operating their own small business, while 29% said they got more job satisfaction and 25% were relishing the creative freedom of running their own show.
Small is also beautiful when it comes to getting support from customers according to the survey results, with 51% stating they felt it was not only ethical to remain small but that they also got more encouragement from their customers as a result.
There are downsides to running a small business however, with a lack of employee benefits (58%), financial stability (57%), long hours (27%), handling tax returns (25%) and managing cash flow effectively (20%) all cited as issues for the sole trader.
In addition, a mere 8% felt that they’d been adequately supported by the government during the coronavirus pandemic. The feeling from 57% of those questioned was that they’d been overlooked in favour of SMEs and the larger business community. Worringly, 52% of sole traders said the challenges presented over the last year have had a negative effect on their wellbeing, half felt lonely and 46% felt unsupported.
Nevertheless, 33% of those surveyed also reported that the challenges presented by Covid-19 had driven them on to explore the benefits of e-commerce software. Digital sales tools, online marketing options and other e-commerce software had made 39% explore new markets for their business.
Moving forwards, 31% said they had given up on paying for a permanent office while 80% would plump for using office space at home. Interestingly, one in five reported they were looking into having their business base abroad.
“The UK’s sole trader community is over three million strong but will grow in the next few years,” said Donna Torres, director of small business at Xero.
“The pandemic has changed many people’s priorities and encouraged them to take the leap into something new. But it should be done with eyes wide open to the challenges of staying small, particularly as the COVID pandemic and Brexit continue to impact businesses.”