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Changing Use of External Business Advice and Government Supports by SME's in the 1990's


  • R Bennett
  • P Robson


This paper uses cross-sectional surveys of 1991 and 1997, and a panel survey of firms surviving between 1991 and 1997, to compare the levels of use by SMEs of external business advice. The analysis demonstrates only modest changes over time in aggregate use, and these are not statistically significant. This suggests that earlier growth in external business advice services may now have plateaued. There are some significant changes of use by source (increasing for advertising, personnel and recruitment, new technology and computer services; and decreasing for taxation and financial management advice). The paper is one of the first to assess sector patterns. Publishing, manufacturing and other business activities are the largest users of advice. Sector differences are shown to be considerable and need to be taken account of in future analyses. For government advice services, the shift from a centralised structure (Small Firms Service and Enterprise Initiative) to a decentralised structure (training and Enterprise Councils and Business Link) had no impact on greater market penetration except for the greater participation by the larger SMEs in use of Investors in People. Increased use of government sources has occurred, however, through enterprise agencies and regional development bodies. Further comparison in 1999 suggests a decline in use of Business Link and stronger focus of use of government support services. This indicates that the Small Business service and Learning Skills council may struggle to meet their market penetration targets.

Suggested Citation

  • R Bennett & P Robson, 2001. "Changing Use of External Business Advice and Government Supports by SME's in the 1990's," Working Papers wp210, Centre for Business Research, University of Cambridge.
  • Handle: RePEc:cbr:cbrwps:wp210
    Note: PRO-1

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    References listed on IDEAS

    1. Cressy, Robert, 1996. "Are Business Startups Debt-Rationed?," Economic Journal, Royal Economic Society, vol. 106(438), pages 1253-1270, September.
    2. Cooke, Philip & Wills, David, 1999. "Small Firms, Social Capital and the Enhancement of Business Performance through Innovation Programmes," Small Business Economics, Springer, vol. 13(3), pages 219-234, November.
    3. Reid, Gavin C & Smith, Julia A, 2000. "What Makes a New Business Start-Up Successful?," Small Business Economics, Springer, vol. 14(3), pages 165-182, May.
    4. repec:wuk:andedp:9711 is not listed on IDEAS
    5. Buckley, Peter J & Chapman, Malcolm, 1997. "The Perception and Measurement of Transaction Costs," Cambridge Journal of Economics, Oxford University Press, vol. 21(2), pages 127-145, March.
    6. Hugh Whittaker, 1999. "Entrepreneurs as Co-Operative Capitalists: High Tech CEOs in the UK," Working Papers wp125, Centre for Business Research, University of Cambridge.
    7. Arrighetti, Alessandro & Bachmann, Reinhard & Deakin, Simon, 1997. "Contract Law, Social Norms and Inter-firm Cooperation," Cambridge Journal of Economics, Oxford University Press, vol. 21(2), pages 171-195, March.
    8. Brusco, Sebastiano, 1982. "The Emilian Model: Productive Decentralisation and Social Integration," Cambridge Journal of Economics, Oxford University Press, vol. 6(2), pages 167-184, June.
    9. Birley, Sue, 1985. "The role of networks in the entrepreneurial process," Journal of Business Venturing, Elsevier, vol. 1(1), pages 107-117.
    10. Maher, Maria E, 1997. "Transaction Cost Economics and Contractual Relations," Cambridge Journal of Economics, Oxford University Press, vol. 21(2), pages 147-170, March.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Small business; business advice; consultancy; Business Link; Small Business Service; sectors; Learning and Skills Council; Investors in People.;

    JEL classification:

    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General


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