Small companies fear recession will last up to 2 years
The average small business owner predicts that the recession will last for just under two years, according to a recent survey. However, most SMEs are bullish about their survival.
The survey (PDF), conducted by Kashfow, throughout December last year, polled its users on their opinions on small business survival during the economic downturn. The results show that the average small business owner expects the recession to last 1 year and 11 months, with 20% predicting the downturn to last 3 years or even longer.
Understandably, more than half of small businesses are anticipating cash flow issues caused by the recession. Despite anticipated slower payment, more than 60% were not anticipating delays in paying suppliers themselves. You can read dozens of useful articles on late payment and managing your finances in our cash flow section.
Many small businesses are actually feeling bullish with 77% predicting sales growth in 2009. More than 60% of small businesses instead to diversify to survive the recession, and over half the business people surveyed expect to increase their marketing spend this year.
Further Resources
- Top tips to manage your cashflow during a recession
- How to survive a recession
- Protect your business during an economic downturn
Small Business Views
Duane Jackson, MD of KashFlow who commissioned the report, commented,
"If the UK economy needs inspiration to work its way out of this recession - then it should look no further than the country's SMEs. More than three quarters of them are planning for increased sales despite the economic down turn. They are seeking out new business opportunities, spending more on marketing and employing more staff.
"The dynamic response of SMEs and sheer bloody-mindedness is the approach larger businesses and financiers should be doing to drag us through the current downturn."
Consultant Graham Way from London said,
“Having lived and worked through three recessions, this is only different in that it is global and has happened more quickly than previous downturns. Careful planning and sensible management has always worked in the past and will again.”
George Hewitt of MD Wise Systems and Solutions Ltd said,
“We believe that the current crisis will mean that the fictitious climate created by the banks and other agencies is a good thing. Borrowing more when you are broke is folly. We focus on bringing improvement in business processes, particularly information management, and assisting in the management of business risk. We now have the full attention of people who shown have sought us out in the last 10 years or so.”
Glenda Shawley, The Training Pack in London said,
“I'm not sure how long the recession will last but the strategies the government has employed to get us out of it will leave us all feeling poor for a long time as we pay back all this debt. However as a business specialising in helping small businesses with their marketing and new businesses to grow I believe that the recession will create opportunities for my business.”
Posted January 23, 2009
