By Clive Lewis, ICAEW’s Head of Enterprise
Businesses are doing their best to grow in a tough climate. One of the more encouraging indicators revealed in the latest ICAEW/Grant Thornton UK Business Confidence Monitor (BCM), is reported annual export growth, still trending above pre-recession levels, at 4.4%. Whilst this suggests businesses recognise the growth opportunities for British companies that overseas markets represent, it is against a backdrop of growing weakness in the Eurozone and US economies.
“During the recession businesses took great strides to restructure their finances. Many business re-evaluated their core activities — having paired back to the most productive, it’s time to look at how to resume growth. The strong have survived but their work is not done yet.
There is more still to do to ensure continued growth, namely:
1.Plan the dream future — Ask “How could we grow now?” Not “How have we grown previously?” Whilst I hate the phrase ‘thinking outside the box,’ business leaders need to look at options beyond the tried and failed options of yore.
2.Actively consider new overseas markets. The UK, Europe and the US will experience low growth for the next two years or longer. Evaluate all your options for entering a new market, including a strategic acquisition or alliance.
3.Maximise use of the internet and technology to sell. Is your website delivering? Are you using social media to increase sales? Have you an e-commerce facility in-built to your website? Does your site accept multiple currencies and display in different languages? Does your site have a shopping cart facility? Have you consider selling via platform sites such as eBay?
4.Consider acquisitions or partnerships — Joining forces can significantly reduce costs in tackling new markets be that in advertising, shipping, storage or other. .A joint venture is a recognised way of sharing risks and profits.
5.Explore financing options — Debt finance is not the only way, Angel Investment, grants and more are available. While selling equity hands over a percentage of the company, in return business owners benefit from the wisdom and acumen of a successful operator.
6.Invest in people — With all the changes and developments in the market place of late, the world has moved on. Now’s the time to take stock of the changes and learn from them. Training and development of staff also includes of the management team, of course.
7.Sustainable practice — More than just light bulbs, sustainability in a business sense asks whether the business could continue if any of its resources were to expire. Efficiency and lower resource intensive products are more attractive to customers and often less expensive to produce.
“With around 50% of the UK private sector workforce today employed by SMEs it is vital for the prosperity of the UK economy for them to succeed. In order to do so they must build upon the adaptations they made over the last few years to adjust to the Credit Crunch and subsequent low growth recovery.”