News and Events

SMEs upbeat about downturn


The latest SME Trends Index from Hilton-Baird Financial Solutions has found that the majority of businesses have been able to take positives from the recession and used it as a chance to re-evaluate their processes.

Despite the country entering a first double-dip recession since the 1970s during the first quarter of 2012, the biannual survey, which questioned 454 business owners and finance directors about the challenges facing their business in April, was largely positive.

It found that 39% said the recession has encouraged them to streamline their business and reduce costs, with a further 33% reporting they are now utilising their resources more effectively. One in five are now benefiting from better rates from suppliers and one in ten enjoying increased sales due to reduced competition in their sector.

This positivity could come from the fact the overall Business Health Index, which uses a range of factors such as profitability, bad debts and Crown arrears to calculate a financial health score for each business, rose to 0.54 – the highest score since our survey began.

As a result, 39% expect their business to expand in the next six months, which is up from 31% just six months prior. Only 9% expect their business to contract over the same period.

Business credit cards (51%), bank overdrafts (47%) and existing cash flow (45%) remain the preferred finance methods amongst respondents, with asset finance and invoice finance facilities used by just 20% and 18% respectively.

And as 33% reported that generating new business was the biggest concern for their business over the coming six months, a surprising 58% don't expect to apply for new funding facilities in the same period.

Download the full report here...