by business editor Trevor Sturgess

The internet has made it easier for
smaller businesses to weather this recession better than previous
ones, according to Kent businessman Richard Romain.

Mr Romain, founder of Answers and Solutions Kent (ASK), based in Maidstone, turned to the web to help him operate his telemarketing company as a virtual business.

In anticipation of gloomier economic times ahead, he cut his 10-strong workforce in 2006, and used website PeoplePerHour.com to hire freelance staff and operate entirely online. He says this move enabled him to cut his business overheads by £80,000 a year.

"Small business owners are
constantly advised to keep costs to a minimum in times of economic
downturn," he said. "The advent of the internet makes this painful
process so much easier than in any previous recession."

Mr Romain's comments came as the British Bankers Association said start-up and small business activity was increasing in the UK. In March, lending by high street banks was £271million higher than the previous month, while deposits from small businesses rose by £881million.

Some experts put this trend down to
the increasing use of technology, claiming that entrepreneurs are
using the internet to start up new businesses on a shoestring.

"You don't need huge amounts of
capital or time to start a business in 2009," said Xenios
Thrasyvoulou, founder of PeoplePerHour.com which is an online
marketplace for businesses to buy and sell services and now has
30,000 registered users.

"On our site for example, you can start selling services to
businesses immediately. You can also find help with every aspect of
building a business – from legal advice to marketing and sales –
cheaply, quickly and all from your desk. In 1991 that simply wasn't
possible because the technology wasn't there."