By Daniel Hunter
Confidence amongst the nation’s small businesses has risen at its sharpest rate for four years, according to the six-monthly Business Confidence Index published by Regus, the global workspace provider.
The report, which represents the views of 1900 small business owners, shows that nearly 10% more firms reported a rise in profits during the six months to October than in the previous period.
Only 14% of respondents agreed that economic recovery is fully underway, although a further fifth predicts that the economy will advance strongly by the end of the year.
The UK as a whole has seen the greatest improvement in business confidence of the world’s major economies. Yet the Regus report indicates that efficiency savings remain firmly on the agenda over the next twelve months as firms strive to keep business growth sustainable.
67% of small firms will focus their efficiency efforts on finding more cost-effective service providers, especially in the area of IT and telecoms, and just over half will demand a higher return on investment from marketing and advertising spend. Reducing fixed office space and improving
staff retention are both priority areas for a quarter of respondents.
“This report is highly encouraging and confirms that UK business is returning to health,” comments John Spencer, UK CEO at Regus. “It is especially good news for the economy that greater numbers of small firms are achieving growth. But they evidently still view recovery as tentative, and are focused on creating efficiencies to keep growth on track.
“Business owners should leave no stone unturned in scrutinizing business processes. In particular it pays to review their ‘work style’ and that of their staff. Many underestimate the negative impact that ingrained day-to-day practices such as commuting can have on efficiency and staff wellbeing. Increasingly we are seeing our network of flexible workspaces used by firms to move away from traditional fixed-office working and adopt a more modern, multi-location approach to work — resulting in happier, healthier and more efficient staff.”
Laurie Stephens is Managing Director of The Client Side Consultancy, a management consultancy based in Richmond, London. “We’ve noticed an upturn in outlook in the last six months and have picked up significantly more work,” he says. “I wouldn’t say things are buoyant exactly but I’m feeling positive and have just launched a second consultancy business.”
He agrees that driving costs down, and efficiency up, is vital to capitalise on the recovery.
“One of the biggest expenses for any organisation is premises. I’ve seen consultancies with large, flashy offices that lie empty most of the time because consultants are on client sites or working remotely. It’s a huge financial drain on the business and it makes you less agile. Clients are not really concerned about where we work, as long as we have somewhere professional to meet them. Plus we use more freelancers and part-time consultants these days to scale easily and attract the best talent, so fixed office space isn’t necessarily compatible with that.”
The Client Side Consultancy has a Virtual Office Plus service with Regus, which gives the company a professional address, a telephone answering service and 5 days’ office space per month at any of the 220 Regus centres in the UK. “It’s helped us to operate a “lean” business model and work more flexibly,” adds Laurie. “We can focus on our clients and our profits without worrying about the administrative aspects of running a business. Ultimately it’s made us more efficient.”
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