Business centre lift for start-ups

A SHOE designer, an organic wine distributor and a software developer are among the small business start-ups about to benefit from a cluster of commercial incubators being opened in the East End on Tuesday by Bank of England Governor Sir Edward George.

The serviced offices are part of the new premises for the East London Small Business Centre, the non-profit agency that provides finance and advice to prospective small business proprietors from disadvantaged groups.

Chief executive Tim Heath said the centre advised more than 1,000 people and helped to start about 300 businesses a year, enjoying a survival rate 25% higher than the national average. The centre's services were aimed at minority groups, including those of ethnic minorities, and people who were unable to secure bank finance and knew little or nothing about starting and running a business, he said.

Its services include a four-day intensive training course focusing on marketing and market research, financial managementand cashflow issues, writing business plans and dealing with tax.

The centre derives 40% of its £1.5m annual income from the Government. About 10% comes from local authorities and another slice from a string of sponsors including Lloyd's of London, Deutsche Bank, BP, Barclays, Allen & Overy and the Bank of England.

Heath said much of the work for the new businesses came from Government contracts. Other sources include local authorities, the Small Business Service, and other groups that had secured funding to help start small businesses. He added that growing demand for the centre's services had seen it double in size in the past three years, employing 22 staff, 15 of whom were in direct contact with clients.

It has a series of revolving credit facilities which are non-repayable loans provided by public and private groups. The money is lent to the small businesses which are requiredto repay it to the centre under agreed terms. 'We are pretty good at backing good prospects when the banks won't,' Heath said. 'We are the backstop when the banks say no.'