Yorkshire SMEs Reveal Optimism Over Growth

Survey Shows 71 Per Cent Of SMEs Expect Improved Fortunes

21.05.2014

Fergal Dowling, Partner | +44 (0)121 214 5476

More than seven out of ten SMEs in Yorkshire and Humberside expect their businesses to grow in the next three months, a new survey has revealed.

The Business Factors Index, produced by Bibby Financial Services, showed the region is enjoying growing confidence after a good first quarter. In the first three months of 2014, 48 per cent of SMEs in the Yorkshire and Humberside areas saw sales rise, with 15 per cent describing the rise as significant.

Employment has also benefited as 24 per cent of SMEs have taken on more staff, while 46 per cent have invested in new equipment, technical services or premises.

Bibby noted these findings matched the national pattern of a picture that is continuing to brighten.

Managing director for Bibby Financial Services Yorkshire and Humberside Mark Storey said: "The findings of our research for Q1 2014 reflect national SME performance according to our headline index data, which recorded the highest level of first quarter output among our 4,000 invoice finance clients since 2008."

Although all this appears positive, Mr Storey said there remains one cloud on the horizon. He noted: "If SMEs in Yorkshire and Humberside are going to realise their growth ambitions, it is important that they have access to funding that supports the development of their business."

The expert noted that one in ten SMEs is struggling with its cash flow and is getting little or no help from traditional forms of finance. He said facilities such as invoice finance would be best suited to helping smaller companies who are going through a period of growth.

Such an issue is a common fly in the ointment for the SME sector at a time when many companies are enjoying growth, holding back a minority from prospering.

The problem has been acknowledged elsewhere, with the Bank of England's Quarterly Inflation Report produced earlier this month among the publications to point to this as an ongoing issue, although the level of access to business finance as a whole has improved.

Expert Opinion
This research in Yorkshire reflects wider, more national trends with a growing number of small and medium-sized enterprises seeing their fortunes improve in recent months and expecting further positive growth across the short-term future.

"It also identifies another widely-regarded issue in terms of access to finance, although smaller firms would also be wise to pay close attention to several other factors as they prepare to expand and develop their offerings.

"Something that is particularly important is having access to high quality legal advice, which will allow businesses to ensure they are meeting all of their regulatory responsibilities and are able to mitigate any of the potential growing pains which could arise in the future."
Fergal Dowling, Partner