2017 was a tumultuous year in business – but what will 2018 bring?
It’s important that businesses of every size are thinking ahead and planning for the immediate future. To help you do that, we’ve explored some of the issues that might affect the self-employed in the coming year. Read on for our self-employed predictions for 2018.
- The 15 best places for small business growth in 2018
- Self Assessment tax returns: a self-employed guide
- Can I pay my tax bill with a credit card?
- What can I claim as self-employed tax deductible expenses?
1. There will be greater economic uncertainty
The Autumn Budget gave mixed signs for the economy, and the self-employed should prepare for uncertainty ahead. It’s not just Brexit on the horizon – as the base rate of interest rises, and with the continuing squeeze on wages, there are also growing concerns about a potential debt crisis facing over-leveraged companies and consumers.
2. Consumer spending will fall
That debt crisis may be most severely felt in consumer spending. Brits have endured years of wage stagnation, which have been partly offset by cheap borrowing.
However, the cost of servicing debt is increasing, and this could cause problems. There are also worrying signs for businesses, many of whom have taken advantage of the low interest rate environment but haven’t planned for rate rises.
3. More millennials will enter self-employment
Despite this, self-employment is set to grow in 2018, and a good proportion of this growth will be accounted for by young people.
Millennials and even some Gen Zers will continue to enter self-employment, and many of them will do so by turning their ‘side gig’ or hobby into a profit-making business.
This is especially common in small-scale craft and service businesses, and the marketing opportunities available online have made this increasingly possible. Read more about turning a hobby into a business.
4. Desk space will become even more readily available
Moving into an office or dedicated premises is a big step for self-employed people. But the desk and office space landscape is changing rapidly and dramatically, and it’s becoming increasingly easy to secure space for a small business.
The growth of ‘co-working’ spaces has meant that it’s now more affordable than ever to find your own space, and the terms are increasingly flexible. Just as importantly, co-working spaces are springing up everywhere – you don’t just have to be in one of the UK’s major cities.
5. Banking will change significantly
Banking for both businesses and consumers is going to change in 2018 with the introduction of Open Banking.
This new set of rules will herald a number of changes to the banking system, but perhaps the most important is the ability for customers to take better control of their data.
Up to this point, the big banks have had a monopoly on customer data, and they’ve been unwilling to share it. Soon, though, you’ll be able to give access to selected parts of your banking information to third parties, who will be able to offer you new services or deals based on your specific profile. This could have big cost implications for businesses that have credit facilities and want to shop around.
6. Get ready for GDPR
The European General Data Protection Regulation (GDPR for short) will affect businesses of all sizes in the new year, with an effective date of 25/05/18. The UK is gearing up for tougher fines and stricter regulations, across all industries.
In a nutshell GDPR is being implemented for two key reasons: to give the public more control of their personal data, and to simplify and unify regulations for business across the European Union.
It’s easy to dismiss GDPR as not relevant to your smaller business, but GDPR applies to any business that processes the personal data of EU citizens, including customers, suppliers, partners, and employees.
Read more about GDPR in our guide to GDPR for small business.
7. You’re going to have to learn what the blockchain is
Finally, tech marches on apace, and new technologies and techniques are going to have wide-ranging implications for businesses of every size.
If you’re feeling left behind by new buzzwords, you should consider spending some time learning about the key trends: blockchain, AI, AR, VR, big data, and the rest.
Regardless of whether you’re a one-man band or a growing company, it’s becoming increasingly important that you understand what’s happening in technology and how it will impact your business.