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Omnibus Survey of Small Businesses in Scotland 2002: Rural Analysis
2 Summary of results
The findings show that there are some significant differences between Businesses in the three geographic areas in Scotland.
2.1 Characteristics of SMEs
- The size of business does not differ significantly across the three geographic areas. There are slightly more firms with no employees in the accessible rural area and the remote rural area than in the urban/small town area (45% and 42%, respectively). In the remote rural area there are fewer medium firms (38%).
- There are more Businesses from the financial services sector and fewer from the agricultural sector in the urban/small town area than in the accessible rural and remote rural areas. It is interesting to note that the proportion of manufacturing firms is highest in the accessible rural area. Retail and wholesale are less prominent in accessible rural and remote rural areas.
- Over half of the Businesses in the urban/small town area are companies, whereas in the remote rural area just over a third of the Businesses are companies (56% compared to 32% in the remote rural area). The general tendency in the accessible and remote rural areas is towards unincorporated Businesses.
- The areas with the highest proportion of family owned Businesses are the accessible rural area and the remote rural area (73% in each), compared to 64% of Businesses in the urban/small town area.
- Membership of trade bodies is related to location of the business as 51% of firms in the urban/small town area are members of a trade or business association, compared to 44% of firms in the remote rural area (accessible rural area - 50%).
2.2 Issues facing SMEs
- Respondents to the survey were asked if the sales objectives for the business over the next three to five years were to grow, stay the same or reduce. The proportion of Businesses growing is highest in the accessible rural area (58%; urban/small town area - 52%, remote rural area - 54%). However, the proportion of Businesses planning to reduce sales is also highest in the same area (5%; urban/small town area - 1%, remote rural area - 0%).
- Respondents were asked to identify the greatest obstacle to the success of their Businesses. The economic environment was ranked as the greatest obstacle by more Businesses in the urban/small town area than in the other two areas (21%, compared to 18% both in the accessible rural area and in the remote rural area). For Businesses in the remote rural area the greatest obstacle is taxation (20%).
- There are nearly twice as many (12%) Businesses from the urban/small town area that serve markets 'mostly in the UK outside Scotland', compared to Businesses in the remote rural area (7%).
- Businesses from the urban/small town area are more likely to export abroad (Europe, America, Middle East, Far East, rest of Asia, Australia and New Zealand) than Businesses in rural area, 15% compared to 12% for both accessible and remote rural areas.
- Overall 22% of Scottish Businesses had had difficulties renewing their commercial combined insurance in the last year. The proportion of Businesses having difficulties in renewing their insurance was highest in the accessible rural area (24%) compared to 22% in the urban/small towns area and 20% in the remote rural area.
- In seeking finance, 26% of the Businesses in the remote rural area did not obtain finance they had applied for, compared to 14% of Businesses in the urban/small town area and 5% in the accessible rural area.
- The geographic area of the business is a factor in the use of ICT as over a third of the firms in the remote rural area do not use it (31%), compared to one in five firms in the urban/small town area (19%). Fewer Businesses in the remote rural area have a website (22%, compared to 38% in the urban/small town area and 29% in the accessible rural area).
2.3 Sources of advice
- There is a relationship between use of advice and geographic area of the business as 58% of Businesses in the urban/small town area had used advice compared to just 39% of Businesses from remote rural area and 49% in the accessible rural area. The main reasons for not using any advice were that the respondent felt they had no need of help at the moment (72%) and had enough expertise inside the business (15%). Only 1% of Scottish SMEs had not used advice because they did not know any was available. The reasons for not using any advice do not vary significantly among the three geographic areas.
- Prompted awareness of the Small Business Gateway/Business Improvement Service was higher in the urban/small town area than in the remote rural area (urban/small town area - 43%, accessible rural area - 46%, remote rural area - 28%). Very small numbers of Businesses had used the Small Business Gateway/Business Improvement Service.
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