08/07/10

By by chartered accountants and insolvency practitioners Harris Lipman.

Small businesses have been through a tough time over the last 12 months but are now looking to the future with a little more confidence. That is the message from a survey carried out by North London chartered accountants and insolvency practitioners Harris Lipman, which recently surveyed its small and medium-sized clients across a range of business sectors on their recent experiences and predictions for the future.

Many firms painted a gloomy picture of the economy in 2009 with 32 per cent of respondents saying business had been a lot worse than usual during the year, and 36 per cent a little worse. By contrast, just seven per cent thought things had been a little better and the same number a lot better, with 18 per cent saying business had remained about the same as usual.

Fortunately, there was more optimism about the year ahead, with 14 per cent expecting business to be a lot better than the year before, 36 per cent a little better and 34 per cent about the same. Just four per cent expected things to be a lot worse and 13 per cent a little worse.

There was optimism that a change of government would bring improvement, with 70 per cent predicting the new government would be good for business compared to just two per cent who thought it would be bad for business and 28 per cent who thought they would have no effect. In addition, 56 per cent agreed with the government’s stance that reducing the deficit should be their first priority, compared to 20 per cent who wanted to see them forcing the banks to lend more, 13 per cent who wanted to see a cut in red tape and five per cent each opting for tax cuts and increased public spending.

Harris Lipman senior partner Barry Lewis said: “By everyone’s admission, small businesses do represent the heartbeat of the economy and generally surveys that are published relate to the much larger companies, so I’m very pleased that we’ve been able to gain this insight into what smaller firms are thinking.

“There is no doubt that the last year or so has been very tough for small and medium-sized businesses, but it is heartening that the majority now think the worst is behind us and things will start to improve over the coming year.

“While the majority of our clients have stated that the government’s first priority should be to tackle the deficit, concerns about taxation, red tape and bank lending show that the new coalition should continue to do all it can to make life easier for businesses, helping them to create jobs and contribute to the economy as they would like.”

The survey also revealed that the current problems in the Eurozone are having a damaging impact on a significant minority of firms — 32 per cent said they were having a negative effect, versus just four per cent who said they were providing a positive opportunity, with the rest saying it made no difference.

When it came to the burden of regulation on businesses, 56 per cent of respondents wanted to see less requirements around audit and compliance, compared to four per cent who wanted more and 25 per cent who wanted to see no change, while 15 per cent said the priority should be providing clearer guidelines.

For more information please call 020 8446 9000 or visit www.harris-lipman.co.uk.