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Despite current economic conditions reports suggest optimism remains amongst SMEs in London.
Business Link has today announced that small businesses in London remain upbeat despite prevailing market conditions.
Over half of businesses surveyed by Business Link believe they are better prepared to survive the economic slowdown than their larger corporate counterparts.
58% have even reported plans for growth over the next twelve months.
Policy outlook is bright
The past two weeks have been characterised by a string of pro-small business policy announcements. Last week saw the biggest and most important announcement - that the European Investment Bank (EIB) would be making £40 billion available to UK banks to pass onto small businesses.
This morning the British Bankers Association (BBA) has announced that it would keep the momentum going in SMEs favour by redrawing its Statement of Principles to beef up the promise banks make to small business customers.
The BBA is to host a pathfinder meeting with high-level government contacts next week with a view to having a draft of the revised Statement of Principles ready in time to bring it along to the proposed industry roundtable currently being arrangement by BERR.
Patrick Elliot, CEO of Business Link in London, comments:
“The small business community is going to be incredibly important to the economy in the coming year or two. It’s these companies that generally provide much of the business activity and innovation, and a significant share of employment.
Of course the economic downturn is likely to hit all areas of the economy to some degree. It’s a fact the Government has recognised through a series of commitments to help protect small businesses, including free health checks from Business Link throughout the country. But the SME sector has a lot of advantages – many of the businesses we spoke to cited low overheads and a loyal customer base as key factors that will help them continue to thrive. For the time being at least, London’s entrepreneurs seem to be keeping doom and gloom away from their door.”
More on Business Link Survey:
Around a quarter (26 per cent) of SMEs questioned are planning to hire more staff in the next year to fuel growth, with 44 per cent aggressively seeking out new business opportunities.
Why are SMEs able to fare better than bigger companies? Smaller overheads, so less exposed to price rises: 4% More loyal customer base: 7% Lots of demand for our products/services as they’re very specialist: 4% We can react more quickly to market conditions: 10% Strong relationship with investors: 2%
The figures come from 656 interviews conducted by Business Link with small businesses throughout the capital as part of routine contact with its customers. They show a predominantly upbeat mood in the small business sector, despite around a third (35 per cent) of them also reporting a drop in sales since the start of the credit crunch.
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