Uncertainty is rife and founders are feeling the pressure; 54% of small businesses think the current economic climate is more uncertain than the pandemic. With the Autumn Budget and the threat of further tax changes looming, it’s clear that waiting for a helping hand isn’t an option. Founders must be proactive and take their future into their own hands.

The promise of support

Recent legislation shows that the Government has good intentions. The recent Small Business Plan is a good example of this, with measures proposed to tackle late payments and provide more accessible finance. Given the severity of the late payment issue, this is indeed a welcome announcement.

Yet, as I hear from small businesses every day, there’s a clear credibility gap – delivery on the ground falls short. The practical benefits of the government's plans are slow to appear, as many of the UK’s 5.5 million SMBs have experienced.

The UK-India trade deal, for example, was positioned as a critical boost for businesses, but benefits of the deal won’t be seen for at least another 18 months. The slow delivery of plans makes long-term strategy almost impossible for many founders, who are trying to make payroll each month. However, the smartest entrepreneurs aren't waiting around for these kinds of changes to take hold – instead, they're already pivoting to a new kind of survival strategy.

What smart founders are doing now

There’s no denying that the current climate is tough. However, the most successful small businesses aren’t waiting to be rescued; they’re engaging in proactive planning for any scenario.

Our recent survey revealed that only 29% of small businesses run recession models, but those that do are in a far better position to survive chaos. By using scenario planning, businesses can identify deadweight costs early on, and make the worst case scenario a survivable one.

Financial visibility is a key part of proactive planning, but is also a critical lifeline in itself. By making data-led decisions and protecting their margins, business leaders can have a clear and accurate picture of their business at all times, preventing knee-jerk reactions to adverse economic events.

Of course, time is money – especially for small business owners. Automation is a core part of the solution for business owners, who lose one working week a month to admin, according to our research. By embracing AI tools, smart entrepreneurs can free themselves up to focus on high value activities, like networking, winning new clients, and building a more resilient strategy.

A call for practical policy

None of this is to say that the Government doesn’t have a role to play. If the country really does want to unleash Britain's entrepreneurial spirit, it needs to match its late payment reforms with practical productivity policy.

By incentivising digitalisation, the Government could successfully encourage the adoption of digital infrastructure, supporting a modern, productive economy. A VAT relief or tax credit, similar to what the government has previously done to boost the adoption of electric vehicles, would be a clear and important sign of the government’s commitment to supporting small businesses.

The ultimate survival strategy

There is an uncomfortable truth in all of this: even the best designed government support cannot save a business that isn’t already taking action itself. With the threat of new costs and tax changes constantly looming, waiting for the cavalry is not the answer.

To the small business owners out there, the most important margins over the next year are your own. Protect them. Your survival depends on whether you’ll face the fear with confidence, and build the future you want for your business.