Businesses in the South West expect significant growth over the next two years according to the Institute of Chartered Accountants in England and Wales’ (ICAEW) Enterprise Survey 2010. The survey, now in its fourteenth year, shows that 82 per cent of businesses in the region plan turnover growth. This is a considerable increase from 2009 and more in line with the level shown in 2008.
Jon Blake, ICAEW’s South West Regional Director, said: “This survey demonstrates that, as the economy begins to recover, growth expectations in the South West have recovered strongly. Despite a challenging twelve months, the resilience of businesses in the region shows through with the majority planning growth and setting various objectives to move forward and develop”.
Increasing profitability is the key objective for around half of businesses in the South West. However, they are more likely than businesses in other regions to say that they have been adversely affected over the past year by changes in raw material costs (42 per cent compared with 33 per cent for the UK overall). South West businesses are also more likely to anticipate that changes in the cost of oil/petrol will have a negative impact on their business over the next 12 months.
In terms of globalisation, businesses in the South West are less likely to be involved in a number of international activities. They are significantly less likely than businesses in the UK overall to say that they currently have operations or activities outside the UK, that they adapt their products and services to other markets and that a share of their business functions takes place outside the UK.
Jon Blake added: “Businesses in the region continue to do less business abroad which I feel is a missed opportunity. The transport infrastructure in the South West is a factor but companies need to think beyond this and look at the bigger picture”.
In addition, globally-engaged businesses in the South West are less positive about continued globalisation and any impact it will have on their business within the next five years. They are less likely to plan to expand into or increase market share in countries outside the UK in the next two or three years (32 per cent compared to 43 per cent of businesses in the UK overall).
In terms of regulation, around half of businesses in the region feel that the UK’s regulatory and taxation regime is business friendly, which is in line with businesses in the UK overall.
The annual survey of chartered accountants in business provides a unique picture of the opportunities and threats facing UK businesses: economic issues, growth, globalisation and regulation. The full ICAEW UK Enterprise Survey Report 2010 can be accessed at www.icaew.com/enterprise
