Research dispels failure myth (From Gazette & Herald)

Research dispels failure myth

THE myth that most new businesses fail within the first year deters many of Yorkshire's hard pressed farmers from starting up alternative rural enterprises, says the Country Land and Business Association (CLA).

New research just published by the Government has found that although the failure myth is widely believed, the opposite is true - more than 80 per cent of small businesses survive their first year of trading.

"2006 is the year when all farmers will be reviewing what they do and whether they need to change in the wake of the biggest agricultural reforms in 50 years," said the CLA's regional director, Dorothy Fairburn.

"Our concern is that many will choose to retire, perhaps not willingly, and many may wrongly reject potentially-profitable new ventures whether farm-based or not because of these myths that farmers believe to be true.

"Unless we can dispel them, it's bad news for the rural economy."

Among other myths revealed by the research, conducted on behalf of the Department of Trade and Industry (DTI) by Durham University Business School, were:

MYTH : It takes years to start a business from scratch.

FACT: Most businesses are up and running within six months.

MYTH: It's hard to make an adequate living from a new business start-up.

FACT: Most people's estimate of income in their first year of trading is only half of the figure actually achieved by small businesses.

MYTH: The majority of business loan applications are rejected

FACT: Overall, only between 10 and 20 per cent are rejected.

"Small businesses and start-ups make a major contribution to the health of the rural economy.

"As more and more farmers have to look at alternative or additional ways of making a living, the CLA is supporting new initiatives to make them fully aware of available support and advice.

"But our campaign will have to begin by dispelling these myths that are putting off people starting up something new, when in fact they should definitely give it a go," said Miss Fairburn.

Updated: 09:36 Wednesday, January 04, 2006