By Daniel Hunter
While UK business confidence hit a 20 year low in August, as reported in the recent BDO UK Business Trends report, the latest quarterly Thames Valley Business Barometer shows that the region’s businesses are continuing to weather the storm more confidently than the rest of the UK.
Although overall economic confidence in the region dipped slightly during the summer period, results still remain positive with more than half (54%) of businesses stating that new business pipelines and order books have increased.
However, Thames Valley businesses are showing a greater degree of caution with more muted confidence and lower expectations of growth than reported last quarter, eliciting a zigzag path of business sentiment. Looking forward, the Barometer indicates that there will be some leveling out in terms of expectations for the next three months. Approximately one third of companies forecast no further improvement in turnover or profitability in the next quarter.
In the latest Thames Valley Business Barometer, which is published by accountancy and business advisory firm BDO LLP and the Twenties Club, 85 business leaders in the region completed the survey. More than 70% of those surveyed stated that the economy has improved or remained the same, compared to 82% in the previous quarter.
Signs of investment by Thames Valley businesses are encouraging, especially in terms of recruitment intentions, training & development, and in positive attitudes towards apprenticeships and work placement schemes. Headcount increased for 40% of respondents this quarter and is expected to increase at a similar level (42%) in the next three months. The single biggest area for business investment is in training & development (38% of respondents).
Availability of finance is still seen as a major blocker for business growth. More than half (56%) of the region’s businesses believe that the situation has not improved, with many stating that obtaining finance is no easier now than when the recession started.
Superfast Broadband was cited by 52% as most critical to Thames Valley competitiveness. Given downbeat forecasts of graduate unemployment, it is particularly interesting to see that nearly half (49%) of businesses also see investment in apprenticeships and work placement schemes as extremely important.
“Although there are some deep-rooted problems across the UK, our latest Barometer results demonstrate that the Thames Valley seems to be weathering the storm," Julian Frost, Partner and Head of BDO in the Thames Valley, commented.
"The Thames Valley has a strong entrepreneurial spirit, boasting 45,000 SMEs, as well as many large multinational corporations. I think there is real determination, resilience and drive being displayed by many businesses here in the Thames Valley and that’s what the economy needs — confidence.”
The Barometer report includes a number of in-depth profiles of a cross section of Thames Valley businesses including CH&CO, Peter Brett Associates, Regus UK, Romans and SAS UK. These companies shared their perspectives on their own performance during the last three months, the key challenges they face, international opportunities and the prospects of the Thames Valley region.
“The more organisations that get involved in our Business Barometer, the more able we are to gauge what is really happening for businesses in the Thames Valley," Paula Elliott, Managing Director, C8 Consulting commented.
"We urge local businesses to share the results with their own networks — customers, suppliers, and partners - to encourage their participation which will extend the Barometer’s reach.”
Join us on