Following Monday’s blog entry we can report that recent market research by B2B International shows that London’s entrepreneurs are more optimistic for 2010
London’s small businesses report that the recession is now having less of an impact on their business and levels of optimism and resilience remain high after the final quarter of the year, according to Business Link in London’s latest Business Confidence Index carried out by B2B International.
Although 69% of entrepreneurs tell us they are still affected by the recession, the impact is less significant – only 13% reporting they are extremely affected. This is a significant drop from 21% in July 2009.
The quarterly business confidence Index measures business sentiment of over 3,300 small-to-medium sized enterprises (SMEs).
This unique survey takes into account variations such as industry sector, sub-regional location, business types and business ownership (gender, Black, Asian & Minority Ethnic (BAME), Deaf and disabled).
Commenting on the Index, Patrick Elliott, Chief Executive of Business Link in London said: “Small businesses have always been resilient during times of economic upheaval due to their ability to adapt quickly. This flexibility, combined with their survival strategies and optimism, are likely to have shielded some businesses from the full force of the recession.”
Mayor of London, Boris Johnson, added: “For the second week running another survey shows London’s small businesses can see light at the end of the tunnel. We have been working hard on their behalf and it is rewarding to see this sustained growth in confidence and to hear that, as we start turning the corner, our businesses are optimistic for the future.”
Mr Elliott continued: “However, entrepreneurs are not yet immune to the continuing tough economic climate. A note of caution is necessary to manage the months ahead.”
Reduced customer spending and sales generation are still key problems faced by established businesses. However, their impact on businesses has dropped significantly with only 20% concerned with customer spend in October, compared to 36% in July.
The food and drink sector is fairing better than it was in July due to increased customer spend. However, we are seeing a gloomier picture for the retail sector as customers cut back on purchases.
Declining profits and sales and cashflow constraints top the list of business activities hardest hit by the recession.
More home businesses are optimistic than ever before. They are telling us that they are marginally less affected by the recession than other business types (42% vs. 44%) and that they’re inclined to be slightly more optimistic about their overall future (17% vs. 14%).
Growth and optimism remain high on the agenda for the majority of those surveyed. The number of businesses looking to grow has increased from over half (59%) in February, to 63% in October. Levels of optimism remain unchanged since July (73% vs. 75%) with almost three quarters of those surveyed continuing to be optimistic about their overall business success.
“This cautious optimism is exactly what we advocate. The Index shows that entrepreneurs are refusing to get bogged down in the doom and gloom. Their strategies to tackle the worst impact of the recession are paying dividends,” continued Mr Elliott.
Online sales and trading have emerged as popular choices for growth over the next twelve months, making their way into the top 5 strategies considered. Despite this, increased marketing remains the top tactic favoured by businesses.
The manufacturing and property sectors are least likely to grow which suggests that they are simply concentrating on survival.
Two in five respondents are not planning on making further changes to their business to deal with the recession, an increase of 16% since July (40% vs. 24%). This is further evidence that businesses feel closer to recovery.
If you are a London based business and interested in taking part in the next quarterly Business Confidence Index then please e-mail: firstname.lastname@example.org