One third (33 per cent) of firms within the South West are hopeful for the future with 76 per cent experiencing the same or better trading conditions – a higher percentage than any other region in the UK, according to the latest Bibby Financial Services Business Factors Index. However, 77 per cent of businesses within the region admit they’ve had to cut costs in order to improve efficiency – the highest percentage of all the regions – suggesting firms in the region are now best prepared to ride out the rest of the turbulence in the current economy.
The Business Factors Index has been compiled by business finance provider Bibby Financial Services and is unique within the alternative finance sector. Today sees the second release in a series of quarterly reports which aim to reveal key findings about the economy and small businesses – on this occasion the data shows that South West businesses are experiencing positive growth supporting CBI forecasts for growth in the final quarter of 2009. The Index tracks small business turnover since July 2007 and the trends derived from this data have been collated with the results of a series of interviews conducted with more than 300 business owners across a range of sectors.
When speaking to South West-based business owners and managers the study revealed:
- Although 33 per cent of businesses are hopeful for the future, 36 per cent stated they are only just surviving and have had to make cuts to the business – up slightly by four per cent on the previous Index
- 70 per cent said that business was the same or better than six months ago, down from 75 per cent on the Q3 2009 Index
- Almost one in five businesses (18 per cent) don’t believe they will see a recovery for at least two years.
And some positive signs have emerged:
- One in four firms in the region anticipate the recovery to emerge around Spring this year
- One in five (21 per cent) firms believe they will be among the first to benefit – more so than any other region apart from Yorkshire & Humberside (29 per cent) and the North West (25 per cent)
- 17 per cent of firms say they have actually benefitted from the recession, up from 13 per cent in the Q3 2009 Index.
Ashley Clarke, Bibby Financial Services spokesperson for the South West said: “As the Index suggests, business for many in the South West is looking and feeling buoyant for the coming year. Quoted companies in the South West trading on the FTSE substantially outperformed the market over 2009, registering an overall share price increase for the year of 56 per cent compared with the FTSE All Share increase of 25 per cent.
“While we don’t expect a recovery overnight and it is clear that some businesses have experienced a difficult few months since our last Index, the region’s firms have applied measures such as cutting costs in order to ride out the recession, a weak Pound is fuelling export growth and consumer confidence is slowly rising. Looking forward, prospects for recovery are improving and opportunities for growth are on the horizon.” Bibby Financial Services plans to issue quarterly updates to the Business Factors Index, available online at www.bibbyfinancialservices.com
