Red tape didn't suit the boss of online tuxedos

Red tape didn't suit the boss of online tuxedos. Check it out:
(The Mail on Sunday Via Thomson Dialog NewsEdge) Mike Dobbel was delighted when he launched myTuxedo, his online retailer specialising in men's evening wear and accessories. But his enthusiasm was tested to the limit by an early encounter with the curse of Britain's budding entrepreneurs - red tape.



Mike, 24, says: 'I was so passionate about the idea of running a business, I hadn't given the issue of VAT or employment law any thought. The truth was, I knew nothing about it.' But soon after he launched myTuxedo three years ago, Mike crossed swords with officialdom.

He says: 'Most of our stock is imported and the first shipment was impounded, apparently at random, by Customs and Excise in Felixstowe.

'I found them incredibly difficult to deal with and I ended up having to pay storage fees of GBP1,500.' It wasn't the best start for a new business, but Mike, from Eastbourne, East Sussex, is adamant that red tape won't inhibit his plans. 'I certainly wouldn't sacrifice turnover by not taking on more staff just to avoid the employment regulation that comes with it,' he says.

'I don't see red tape as a barrier to growth, rather a by-product of it. But there must be better ways of minimising the impact it has on small firms.'

Mike's experience is reflected in the annual survey by Sage, the business software firm. It says red tape is strangling enterprise, leaving many entrepreneurs regretting going it alone. It found that 42 per cent cited red tape as the reason they would not start again compared with only 19 per cent who felt that way the previous year.

And older enterprises are feeling the pressure more than younger ones. More than 55 per cent of firms over 20 years old said they would be unlikely to set up in business again, compared with 25 per cent of those less than five years old.

Given that small business has been identified by the Government as the future for employment growth, Sage's findings are worrying.

Matthew Knowles, spokesman of the Federation of Small Businesses, says: 'Legislation can be very heavy-handed because of the way it is applied right across the board.

'We would like to see the Government explore more alternatives, such as self-regulation and codes of conduct.'

Copyright 2006 The Mail on Sunday.
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