The Future of Business
You can see why governments or local councils are so keen to
appease big businesses and provide them with incentives to
operate in the local area. When major businesses have a presence
in an area, they provide jobs, boosting the local economy
directly, and they give an area an identity or strength.
Other businesses will see a major firm setting up somewhere new
and wonder why they are doing it. If the deal is attractive,
they will want the same deal and before you know it, a local
economy is booming.
In this regard, a large part of the
future of business
financing is going to be about incentivising major
businesses to set up in an area. In 2016, there has been
considerable growth in Ireland thanks to competitive tax breaks
for major firms, helping stabilise and improve an economy that
has stuttered in recent times. This growth wouldn’t have
occurred without tax incentives and breaks, and you can see
these being a key factor in where businesses decide to set up.
Big firms aren’t loyal to locations
There is a problem with this approach though and it is why the
future of business financing cannot be solely about offering tax
breaks of incentives to major firms. This approach means
businesses leave one area to come to your area but in time,
another area will be keen to boost their economy.
If they are in a position to offer better tax incentives or
motivation to businesses, you’ll find that firms are more than
happy to shift from where they are now to a more affordable or
lucrative location. This can bring business to you at one point
but it can also lose business at other times.
Creating an industry led location can work
This means the future of business financing cannot just be about
enticing large-scale firms, it has to be about supporting local
residents and businesses to foster their own businesses. In the
modern day, technological progress is crucial and business
financing incentives based at growing small technological firms
can create a base that will be located in your area for many
years to come.
Small firms are looking to set up a base and when you have a
number of firms in your area operating in the same industry, you
become recognised as a hub in that sector or industry.
Incentivising tax breaks or grants for certain industries can
develop an industry that naturally draws employers, employers
and even training schools or courses to your area. This is
likely to have a much more positive long term impact on an
economy than merely chasing big business through aggressive
funding or taxation policies.
Ideally, a mixture of attracting big business and creating an
environment for small and start-up firms to flourish should be
at the heart of the future of business financing..
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