Most small companies not planning for post-recession recovery
Research from The Open University Business School has revealed that only one in nine small firms (11%) are implementing post-recession recovery plans. These firms are also the most optimistic about their immediate prospects.
There are contrasting reasons why firms are not planning for the recovery, according to the survey authors; some 30% of firms say it is because the effects of the recession have not been very significant for their business, while 18% report that they are not planning because recessionary effects on their actual and potential customers are still too uncertain.
The smallest firms are more likely than their larger counterparts to be in a planning quandary, with 24% of those with a turnover below £250,000 feeling unable to plan because of doubts about the future, compared with only 14% of those with a turnover greater than £250,000.
Some 15% of small firms are currently developing their post-recession recovery plans, but 23% do not see the need to bother as their existing plans are already working.
The Quarterly Survey of Small Businesses in Britain found that the challenges now faced by SMEs include a lack of time or capacity (14%) and a lack of skilled employees (11%). These are often problems associated with growth and frequently affect those whose turnover was up over the past year.
Professor Colin Gray, Professor of Enterprise Development, The Open University Business School commented:
“Although there are increasing signs that the economy overall may be turning the corner, recovery remains elusive for the 95% of all firms in Britain that employ fewer than 10 people. This is particularly so for those small firms in the construction and business services sector. As these are two important sectors that strongly reflect the tempo of business life, we may need to be cautious about believing that the recession is over.”
Posted April 15, 2010
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