Press Release
New Year worries for UK SMEs
UK entrepreneurs are concerned for the future of their businesses but few have plans in place to deal with potential risks as 2008 approaches.
As the credit crunch takes further hold, new research from entrepreneur think tank, the Tenon Forum, reveals that four in 10 (38 per cent) SMEs do not have any plans in place to address business risks.
Biggest threats to SME business in the next two years, say entrepreneurs, are:
- Competition (20 per cent)
- Time and money necessary to deal with red tape (19 per cent)
- Inability to hire the right people (19 per cent)
Difficulties generating new business and potential problems with securing finance are also likely to keep entrepreneurs awake at night, with 13 per cent citing these as the biggest risk for their business in 2008.
The transportation sector appears the least concerned by talk of a recession – more than half (58 per cent) are unprepared for business risk, compared to 47 per cent of agricultural businesses and 38 per cent in the retail industry.
Entrepreneurs in the North of England and South West are most concerned about the impact of competing business (24 per cent), followed by London and the South East (22 per cent) and the Midlands (18 per cent).
Andy Raynor, CEO of Tenon commented: “Despite recent interest rate movements, talk of recession is still prevalent so it’s understandable that entrepreneurs at the helm of the UK’s SMEs are nervous about what 2008 will bring. Many of today’s owner-managers will not have experienced such a pronounced economic downturn before so it’s extremely important that they put robust plans in place now in the event of challenging times ahead. By taking some basic steps, entrepreneurs can help their business weather the storm.”
Tenon’s Top 10 Tips on how to recession-proof business are:
- However positive things are, have a “Plan B” – incase the business is hit by something unexpected;
- Act, don’t wait for things to get bad before putting plans in place;
- Cash is king: have the best cash management approach - it’s simple and is the most important part of the business;
- Know where things are: make sure financial records are robust and up to date;
- Have the best possible relationship with the bank – it’s essential they are fully aware of the business’ financial situation;
- Take a new approach to tax – question what can be done to improve tax cash flow and ease payments and consult an adviser;
- Even if demand is slow, always be in control of costs: know which are variable, can be acted on and how;
- Rehearse the most difficult conversations that may need to be had with suppliers, clients, customers, employees and financiers should the worst happen;
- Check employment terms and recognise who are the essential members of the team;
- Price properly - don’t over-react to market conditions, understand whether demand is price-sensitive and don’t give profits away.
Ends.
For more information or to arrange an interview with a Tenon Forum spokesperson or case study, please contact:
Heather Wilson 07968 357327, heather@bbpr.com
Sarah Weston 07720 435405, sarah.weston@bbpr.com<
Notes to editors
About Tenon
Tenon is a leading provider of accounting and business advice to entrepreneurs. Tenon provides clients with expertise in Business Services, Tax, Financial Services, Corporate Finance, Recovery, Outsourcing and Forensic Accountancy. Tenon is the 9th largest UK accountancy firm with a turnover of £137.1million and almost 1700 staff operating through a network of 41 offices across the UK offering local expertise with the backing of a national plc.
About the Tenon Forum
A regular survey of 560 SMEs is carried out every six months for the Tenon Forum by GfK NOP. These findings, combined with the analysis by an independent think tank of entrepreneurs, form the Tenon Forum report. The Tenon Forum is an independent think tank made up of leading entrepreneurs from the UK’s small and medium sized business community. The Tenon Forum Think Tank meets to analyse issues arising from this research.
About the research
GfK NOP interviewed 560 MDs, FDs and other senior directors of small and medium businesses - firms with between 5 and 499 employees. The survey covers all business sectors across the whole of England, Scotland and Wales and the results have been weighted to provide a representative sample of the British economy.
