Advice You - Business

Micro businesses with no employees, or between one and nine employees, accounted for 94.6% of all UK businesses in 2001, 29% of employment and 21.2% of turnover. Approximately 3.1 million people were self-employed in 2002, according to Social Trends 33, 2003. An additional 1.35 million people have some income, or losses, from self-employment. Self-empl

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

oyed men outnumber women by nearly three to one. The proportion of self-employed in the working population has fallen since 1987.

Around 20% of the UK’s self-employed work in the construction industry. Between 13% and 14% are involved in diverse business activities, around 7% work in recreation, culture and sport, and a further 7% in health and social w

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

ork.

Nearly three-quarters of the self-employed had a self-employment income of less than ?15,000 in 2000/2001. NatWest is fully aware of the problem of low income in self-employment and hopes its business managers will help customers to develop their businesses and increase their profits. In December 2001, the Competition Commission reported on bankin

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

g services for business and accused the banks of failing to offer good value competitive services to small businesses. The banks have responded with improvements to their services for business and now cater much better for micro businesses.

KEY FINANCIAL SERVICES Approximately 1.5 million people use personal bank accounts for their business activities

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

and fewer than half of new entrepreneurs open a business account for their start-up enterprise. 52% of self-employed men and 70% of self-employed women were not in a pension scheme in 2000/2001.

Self-certified and flexible mortgages and offset accounts have revolutionised the capacity of the self-employed to borrow for their home and business. Designa

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

ted business loans and grants are hard to obtain, especially for new small businesses. Government support is targeted on disadvantaged geographical areas.

Employer’s liability, professional liability and other protection insurances are high-cost because of rising litigation costs. Liability cover is often prohibitively expensive for the self-employed in

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

risky occupations such as roofing and scaffolding. Critical illness cover is costly because of medical advances resulting in rising longevity. Lack of affordable insurance is a significant barrier to the creation and expansion of micro businesses. Invoice finance, which involves factoring or invoice discounting, has few customers among micro businesses

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

but offers good potential for improving cash flow for businesses turning over at least ?50,000.

COMPANY DEVELOPMENTS Abbey National offers free banking for small businesses. Alliance & Leicester’s Commercial Bank also offers a free banking account. Barclays Clearlybusiness service offers useful information and support to new businesses. Bank of Scotlan

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

d’s Smartfinance is a relevant offset product that cuts the costs of borrowing. HSBC relies on brand scale and reputation and on accessibility to sell moderately priced business banking. Lloyds TSB offers tiered customisation of business bank accounts. NatWest has the strongest brand in small business banking, but is facing stiff competition from the inn

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ovative smaller banks, notably Alliance & Leicester and Bank of Scotland. Insurers products for small businesses tend to lack the degree of brand power possessed by the major banks. Selling insurance products through financial advisers and banks tends to weaken brand identity. Norwich Union’s new “Self employed” suite of policies signals the company’s i

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

tention to cater comprehensively for micro businesses. PROMOTION

Royal Bank of Scotland’s NatWest remains the largest advertiser of banking services to business generally and small business in particular. HSBC, Bank of Scotland and Abbey National are the other leading advertisers to business. The newly self-employed are not an important focus for ba

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

nks’ advertising, or for advertising by other financial-services organisations.

INTERNATIONAL PERSPECTIVE Business owners in the UK have fewer problems with late payment than in many other parts of the world, and are relatively optimistic about future investment and turnover. PEST ANALYSIS

Budget help for enterprise is focused on companies, not on u

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

nincorporated micro businesses. Late payment legislation and invoice factoring can be used to help improve cash flow. Debt levels among employees threaten to restrict new voluntary self-employment, because continuity of income is essential for debt repayments. ‘Push’ factors into self-employment such as redundancy leading to involuntary self-employme

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

nt are likely to assume greater importance. Lack of national broadband coverage restricts the creation of new businesses in rural areas, especially those needing to use IT.

CONSUMER DYNAMICS The percentage of those surveyed who were in self-employment has barely changed since 2000. Only a small minority of respondents feel they are in secure permane

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

t employment and feelings of insecurity have risen sharply since 2000. Despite the apparent increase in insecure employment, far fewer respondents in 2003 than in 2000 intend to become self-employed in the coming 5 years. Banks emerge from the survey reasonably well. Few respondents say banks are unsympathetic to the self-employed in financial diffic

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

ulties, or that they do not give sufficient support to new small businesses, or that they expect new businesses to become profitable too quickly. Conversely, few regard banks as keen to support new businesses and even fewer agree that there is a good range of financial services for the self-employed.

The main messages from the survey available at www.ma

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

rketsensus.com are a growing sense of insecurity in work, alongside a declining interest in self-employment. The two trends may be linked, in that starting a business and becoming self-employed is a step towards instability, a step that may be too far for people who already feel insecure. If the numbers of those intending to become self-employed are fall

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

ng as fast as Key Note’s survey suggests, banks will have less reason to provide services to small businesses and their proprietors. Banks’ keenness to increase consumer lending may, in fact, reduce the number of new customers for small-business services.

THE FUTURE ‘Push’ factors leading to self-employment will probably assume greater importance. Thes

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

e factors include redundancy and a need to augment pensions. Reluctant entrepreneurs will need sound, low-cost business advice.

Women who are self-employed are less likely to employ staff or to aim for growth than self-employed men. Women require encouragement and support to launch into self-employment. There is still enormous scope for the sale of ne

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

w business bank accounts, but confidence in pensions will remain low. Expensive insurance, especially for employer’s and public liability policies and for professional indemnity cover, is a barrier to self-employment in higher-risk occupations. Pace-setting companies include Alliance & Leicester, Bank of Scotland, Lloyds TSB, NatWest, and Norwich Union

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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