November 11, 2009

SME’s survive without outside assistance

Filed under: Loans — Alan @ 7:37 am

A new study shows that about half of all small businesses have managed to stay profitable in the face of the recession. The report comes in the wake of recent criticism from Lord Sugar, who stated that small companies that are struggling are simply ‘moaners.’

According to the study, which was completed by Kingston University, most small businesses have been able to get through the recession by using their own cash instead of loans and financing options from banks.
The results also showed that out of 343 firms surveyed, only about 25% of the SMEs saw their profits fall significantly.

The new finding is said to be a direct contradiction to the common thought that SMEs suffered considerably during the downtown. The study also showed that most SMEs that survived did so with the use of their owners own credit cards and savings accounts.

This proved that SME business owners were forcibly able to adapt to meet the new business conditions and terms of the past year.

The comments from Lord Sugar, the enterprise champion of the Government, in Manchester last week, publicly stated that many of the SMEs that are whining about poor financing opportunities are companies that even he would not loan to.

  • Share/Bookmark

September 30, 2009

SME’s diversify to survive

Filed under: Small business — Alan @ 8:32 am

AviaAvia’s new research shows that more than half of all medium and small business enterprises (also known as SME’s) are attempting to diversify in an effort to make it through the debilitating business environment that is a result of the recession.

SME’s have embraced several different diversification techniques including opening on the weekends, increasing the hours they are open in general, broadening the amount of services or products that they offer, and attempting to broaden their customer bases, in order to attract more business in general to combat the trend to buy less by each consumer.

In fact, SME’s have even embraced several tactics that are generally not considered desirable, in an attempt to stay afloat in current economic times. Some of which include offering discounts, lowering the amount they are able to pay employees, and reducing the amount of employees overall.

Apparently some of these tactics must work since only one out of the fifty businesses that were surveyed stated they needed to receive assistance from the Government. This is not to say that some of the tactics used are not risky, as 12% of all the businesses surveyed reported they had foregone commercial insurance.

Avia’s commercial product manager David Bruce stated that while diversification is a positive sign of flexibility and versatility among the SME’s in Britain, it is worrying that some of the firms do not have all of their insurance policies up to date since this means that some of them may be operating illegally in an attempt to cut corners.

  • Share/Bookmark