What’s the biggest barrier to carrying out R&D in the UK?

Companies reported cost as the most significant barrier to conducting R&D in the UK Innovation Survey (2019) carried out by the Department for Business, Energy & Industrial Strategy.

According to a 2019 Innovation Survey conducted by the Department for Business, Energy & Industrial Strategy (BEIS), cost is reported as being the most significant barrier to conducting research and development (R&D) in the United Kingdom. This was especially true for small companies with limited budgets, as time and resources also present significant challenges. Regulation was cited as a more common barrier to innovation for larger companies.

It’s clear that cost is an overarching issue which has implications for businesses of all sizes—but what can be done? Let’s take a closer look at this survey and consider what steps can be taken to make R&D more accessible.

Cost Is King When It Comes To R&D Investment

The 2019 Innovation Survey found that cost was the most commonly reported barrier to R&D investment. For small companies, there needed to be more resources and time. As such, smaller organisations feel they need help to absorb the costs associated with developing new products and services.

Regulation was seen as more of a barrier to R&D investment for larger businesses. This could be linked to the cost of making changes to existing processes or adhering to new regulations.

Clearly, this highlights a need for more financial support and incentives when it comes to investing in R&D. Governments worldwide have created various programmes that provide tax relief or grants to businesses seeking to develop new products and services. The UK government offers a range of incentives to help businesses invest in R&D, such as the SME Research & Development Tax Credit and R&D Expenditure Credit schemes.

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In addition, many countries have established research and innovation hubs to facilitate collaboration between companies and universities. These hubs often include opened-access laboratories and shared workspaces, making accessing the necessary facilities and expertise easier.

Challenges Faced by Small Businesses

Small businesses often cannot commit the same level of resources to R&D as larger companies.

This means they are more likely to need help finding the right people, investing in the right technology and staying up-to-date with the latest developments.

Finding experienced R&D professionals can be challenging, especially for start-ups needing more money to attract highly sought-after talent. Additionally, lack of access to capital and financial support can limit a small business’s ability to invest in necessary technology such as computers and specialised software.

Finally, start-ups often need more resources to stay abreast of industry trends and developments, which can be difficult.

Larger Companies and Regulatory Barriers

In contrast to small businesses, larger companies face the challenge of regulatory compliance when undertaking R&D projects. This can add an extra layer of complexity and cost to their research activities.

For instance, many countries have strict laws governing data protection and privacy which must be adhered to when collecting customer information for research purposes. Regulations may also be in place that requires the use of certain technologies or the acquisition of specific licences when conducting research activities.

The Implications of Cost for All Businesses

From this survey, it’s clear that cost is a major factor in R&D investment.

For small businesses, limited resources and tight budgets can be particularly problematic when investing in R&D. Larger businesses must also contend with the additional costs associated with regulatory compliance.

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Regardless of size, businesses need more financial support and incentives when developing new products and services. Governments can play a role in providing these, such as through tax relief or grants.

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