Enterprising the coastline

Supporting enterprise development and entrepreneurship

What have been the experiences of coastal towns in overcoming the sort of challenges and opportunities outlined above in supporting enterprise development? While there are a number of descriptive ‘how to’ guides and case studies of ‘good’ practice, there is a lack of publicly available studies that have explicitly assessed the effectiveness and impact of business and enterprise support programmes in coastal towns.

In reviewing the wider literature, it is notable that an industry has developed around supporting small business and enterprise development over the last 20 years. Over this time, a multitude of policies, organisations and programmes of support have been introduced, some of which have come and gone while others have survived and evolved over a number of years.

The Local Enterprise Growth Initiative is the latest approach by central government to foster an enterprise culture within a range of disadvantaged communities and groups across England, alongside which a number of local authorities have re-packaged enterprise support using Working Neighbourhood Fund monies.

The key trend underpinning LEGI was the devolution of decision-making to the local level as it suggested that devolved decision-making has the greatest impact. This differs from previous government attempts to boost enterprise in deprived areas as it provides local institutions and communities with the authority and freedom to best determine local needs, options and targeted solutions in their area:23By encouraging local authorities to devise plans to suit their specific local areas, it is hoped the initiative will be more effective at creating new enterprise.

Within this context, the programme guidance suggested that local authorities and their stakeholders were best placed to develop programmes of support to reflect local needs and requirements. However, despite this different emphasis in the decision-making, Chitty suggests that these areas have experienced the same issues as before:24

More enterprising communities are stronger, wealthier, happier and sustainable. Aren't they? The advantages are obvious. So why, when we've explained the benefits of enterprise so carefully, and offered all the help and support any budding entrepreneur could possibly need, are we not mowed down in the rush as enthused and energised communities respond to the call?Bennett suggests that this lack of take-up is indicative of a systems failure in the provision of enterprise support:25

There is an array of different providers of support that deliver a wide range of different schemes. These schemes tend to be funded from a variety of sources.

There is a lack of networking between support agencies. Agencies say that they refer clients between each other, but research has indicated that the extent of networking and referral activity is often limited.

There is confusion among small businesses as to who to approach from the formal support network for advice and guidance.

There are clear variations in the quality of business support within and between areas. The level and quality of staffing, the emphasis on training and development of staff and the level of funding varies significantly among agencies in the small business policy community. This influences the quality of service that can be provided to the small business sector.

Underpinning a number of these characteristics is the need for more enterprising or more innovative approaches. What types of business and enterprise support are available within coastal towns? The survey of local authorities and the case studies highlight a wide range of interventions, including programmes of business advice and guidance, mentoring and enterprise coaching, financial assistance, incubation space and training. While the specific configuration of provision is different between coastal towns, reflecting local differences in needs and requirements, there is a large degree of similarity in the 'offer' across the group. For example, the majority of coastal towns offer some form of business incubation or managed workspace for start-ups and growth-orientated businesses. There is also an increasing institutionalisation of enterprise coaching as an offer to supporting individuals in managing the enterprise journey. These patterns are not unique to coastal towns and imply a degree of similarity in the barriers and challenges faced in starting and growing a business.26

On the other hand, the survey and case studies highlighted an emphasis on the need for innovation and creativity, and doing things differently, within the guidance surrounding programmes such as LEGI and WNF. This leads to pockets of good or effective practice among the group of coastal towns. This picture of provision will be driven by the interplay between specific local conditions and factors such as:

• the proactiveness of the local business community;
• the posture of the voluntary and community sectors;
• levels of awareness of opportunities for starting and managing a business;
• the strength of the relationship between the local authority and its partners.

These factors will influence the environment in which different approaches and programmes can be piloted and tested. Again, such experiences provide further evidence of the relationship between the entrepreneurial posture of the providers of business and enterprise support and the difference in performance of enterprise in the area. To this end, it would be interesting to explore whether a key determinant of the patterns of enterprise reflect the entrepreneurial posture or approach of the supply side.

Start-up support

As with the majority of localities across England, the survey and case studies highlighted that coastal towns provide a plethora of start-up provision. This includes: business advice and guidance; information and signposting; coaching and mentoring; financial assistance (e.g. grants and micro-finance); incubation space; and training and networking. To this extent, there is very little difference in start-up support between coastal and non-coastal towns.

Given recent changes in the Business Link network, this tends to be provided by local enterprise agencies, welfare-to-work providers (e.g. Inbiz, Action for Employment) and other targeted providers (e.g. Prince's Trust, PRIME, Prowess, ethnic minority business groups). The majority of such provision is underpinned by public funding.27

Provision across the group of coastal towns varies, reflecting the ability to access funding to offer particular types of support (e.g. access to finance packages), the needs of different groups interested in starting a business, and local priorities and targets. Therefore, some areas may be able to provide a range of grants to aspiring entrepreneurs, while others can provide only vouchers or a basic training subsidy. This leads to a 'patchwork' of start-up provision which the government is attempting to manage through the ongoing business support simplification programme in England.

Business development and growth

The second key bundle of provision is focused on supporting businesses to develop and grow on a sustainable basis. The publicly funded element of this market is now shaped by the Business Link information, diagnostic and brokerage (IDB) model. Business Link advisers work with a portfolio of businesses to support them in assessing their development needs and brokering access to other sources of support to address these needs. Therefore, across a number of the coastal towns, there were mentoring and coaching services, business information services, financial assistance (e.g. loan and equity financing), follow-on workspace, and training and skills provision (funded via Train to Gain) provided by a combination of quasi-public and private sector providers.

Given that 50-60 per cent of businesses started in the United Kingdom do not survive more than 12 months, such provision has a key role in enhancing business survival and sustainability rates. Bearing in mind the challenges and opportunities discussed above, there is a need to map the balance between start-up and business development and growth provision in coastal towns, as survey and case studies provide anecdotal evidence that there is a current emphasis on getting individuals into business, as opposed to ensuring long-term sustainability. This is important given the need within coastal towns to diversify local economic activity and reduce the reliance on the tourism sector and associated services.28

Attracting inward investment

The promotion of enterprise can play a part in changing attitudes and images of coastal towns. To this end, a number of the towns have developed enterprise marketing campaigns as a way of attracting private sector investment. This manifests itself in TV and radio advertising, extensive coverage of success stories in local press and media, organising inward missions, and attending conferences and networking events.

There are two key customers here: businesses looking to invest, and potential funders. In terms of the former, the marketing campaigns provide a cost-effective route of tapping into businesses outside the area which may be interested in relocating. The marketing campaigns are part of a wider offer which unlocks specific sources of financial assistance and training to assist in embedding the business within the area. In terms of potential funders, the campaigns are targeted at maintaining awareness and reinforcing a commitment to supporting enterprise development and entrepreneurship.

However, there are a number of questions surrounding the effectiveness of enterprise marketing campaigns in targeting individuals within deprived areas, particularly around the focus on generating business ideas. Atherton and Chitty have suggested that such campaigns reinforce perceptions about enterprise as starting business, not enterprise as a skills set which can be applied within different contexts.29 Again, this different mindset will be critical in the efforts of coastal towns addressing the challenges outlined above related to developing skills in local young people.