Thames Valley company directors and business owners delay retirement plans
To download a PDF of the full results of our Thames Valley Credit Crunch survey
James Cowper, currently engaged as administrators of a major automotive components company in Wales, has surveyed 1,000 company directors, clients and friends of the firm for their views on how the recession is affecting them.
It is often quite easy to forget how the recession affects business owners and senior managers with much of the media attention focusing on the large numbers of staff being made redundant.
Over the past month we at James Cowper have surveyed 1,000 clients and friends of the firm for their thoughts and plans during this period of extremely tough trading. The survey results offer an insight into the minds of company directors and business owners on how they are approaching this recession and the impact it is having on them personally. The findings make interesting reading and show just how hard this global economic slowdown has hurt businesses and people both on the shop floor and those at the top.
We asked our survey participants how the current recession has affected them personally, and the results showed that almost 40 per cent (39.3 per cent) are having to delay retirement plans by up to 10 years as a result in the global economic slowdown. 50 per cent of company directors and business owners have also taken a significant drop in personal income with 25 per cent having to look to alternative sources of income to survive.
The survey found that 57 per cent of businesses have unsurprisingly implemented very tight cost controls to reduce spending, with 20 per cent reporting redundancy programmes. Interestingly, 14 per cent of respondents have increased their marketing spend hoping to market their way out of the recession. A further 11 per cent of respondents report having to diversify their business activity to survive, with five per cent actively targeting the public sector in the belief that this may provide for a steadier income stream.
James Cowper asked respondents what their biggest concerns are now and what they are likely to be in six months time. Almost a quarter (23 per cent) of respondents stated that finding or loosing customers is their biggest concern now, with the picture changing little when asked to look forward six months with 17 per cent of respondents believing this will still of concern.
Cash flow is of a concern for a fifth (20 per cent), both now and when looking forward six months. General confidence in the economy is also of concern for a fifth of respondents now, but perhaps more encouragingly, just 10 per cent of respondents believe this will be of concern in six months – the first sign of those green shoots perhaps.
It is interesting that our survey reports that finding and keeping customers is pretty much the number one priority for businesses across the Thames Valley, but just seven per cent are actively looking at ways to improve customer service. This ought to be a priority for all businesses.
The survey asked business owners and directors across the Thames Valley for their opinions on the government support made available to help the business community survive the recession. With the exception of the reduction in VAT, where almost three quarters (73 per cent) of respondents saying this was effectively a waste of time, respondents are broadly supportive of the government’s efforts. Almost three quarters (73 per cent) of respondents believe the HRMC’s time to pay initiative is singularly the most important step. 57% believe that the bank bailouts have been a good thing and 50 per cent believe that the new funding initiatives introduced by the government have also been of help.
The survey asked what single measure the government could introduce to support businesses through these difficult times. Almost 50 per cent of all respondents would urge the government to make money directly available to companies rather than via banks to bridge short-term need.
To finish on an optimistic note, almost 60% of those surveyed (58.9%) felt that the Thames Valley is better placed to ride out this recession than other parts of the UK. Whilst not immune the Thames Valley entrepreneurial spirit, its diverse business base and its central ‘hub’ location will leave it better placed when the economy once again looks up.
Sue Staunton, Partner of James Cowper LLP, and head of James Cowper Insolvency Services Tel: 01865 200500 or email: sstaunton@jamescowper.co.uk
10.06.2009