When asked whether current government policy is supportive of private enterprise, the majority of the survey’s respondents were positive, with less than 30% of participants giving a negative response.
Despite the fact that most respondents’ appetite for borrowing hasn’t altered since the results recorded in early summer, 31% of respondents indicated that they believe that access to funding is improving.
On a scale of 1-10 (with 10 being most likely) only 2% of respondents to the Smith & Williamson Enterprise Index were pessimistic when asked about their expectations for the economy over the next 12 months. 91% of respondents expressed an expectation that the economy would improve and 7% were unsure.
The Royal Bank of Scotland (RBS) has recently launched an independent review of its lending to small businesses. The bank has hired former Bank of England Deputy Governor Sir Andrew Large and Management Consultancy Oliver Wyman to examine its lending practices.
It is often assumed that raising external, or third party, equity is a prerequisite to business success. In the majority of cases, this could not be further from the truth. Most businesses start with very limited funding. This is typically provided by the founder, or by family and friends on an informal basis. As these businesses develop, they bootstrap their growth, using their own profits and assets to finance their needs. As a result, they get to keep their potentially valuable equity in the hands of the founder or the family, along with the choices and freedom that brings.
The following interview with Stuart Miller, CEO and co-founder of ByBox, the logistics business, is part of ‘The Entrepreneur Interview’ series by Guy Rigby, Head of Entrepreneurial Services at Smith & Williamson.
The latest Smith & Williamson Enterprise Index revealed that confidence in the economy is on the up with 73% of respondents expecting an upturn in the economy.
The inaugural Index, carried out in January of this year, recorded a positive outlook as far as the economy was concerned with a benchmark score of 100, whilst the second quarter saw a slight dip in respondents’ optimism with the score dropping to 90.1. However, it appears that the confidence felt by the UK’s wealth creators at the start of the year has returned with a vengeance with June’s Index score increasing to 103.3.
For many growth businesses, the frequency and impact of unexpected events can be alarming and difficult to handle. But with the use of creative foresight and a technique known as ‘scenario planning’, businesses can spot opportunities and make good decisions to help manage future uncertainties.
You will have to deal with many unexpected events during your business life, but by ensuring you do everything you can to anticipate scenarios and outcomes you’ll be better equipped for a fast and effective response as and when they arise.
Getting the right offer for your business will require excellent negotiating skills and a good dose of psychology. The price you eventually receive will be affected by scarcity, demand, emotion, vision and competitive tension. This is a potent mixture and the sell side objective must be to get the buyer to the point where it would be an unmitigated disaster if he lost the opportunity to someone else.
An interesting development in the mergers and acquisitions (M&A) market is the emergence of the hybrid private equity/trade buyer – a kind of private equity buy and build approach, in contrast to the classic trade buyer who bids for businesses in the same industry in order to achieve potential synergies and cut costs through economies of scale.
Asset-based lending (ABL) was once considered the lending of last resort. But times have changed and it is now a realistic alternative to conventional cashflow lending.
What is ABL?
ABL generates finance against a company’s existing and future assets including debtors, stock, plant, machinery and property. The due diligence process tends to be faster than traditional lending routes and funding can be provided more cheaply.