Credit crunch hits more manufacturing businesses
The owners of small retailers and manufacturing firms are blaming the government for the effects of the credit crunch, according to a survey carried out by one of the Forum of Private Business’s (FPB’s) partners, UK200 Group, which represents lawyers and chartered accountants.
The research reveals that 88 per cent of respondents say the economic downturn is hitting their levels of business, with 72 per cent forced to reduce their margins as a result. Respondents were invited to select the factors they consider to be responsible for the downturn. Although 85 per cent blame the banks to some extent, and 73 per cent the ‘world economy’, 90 per cent say it is the fault of the government.
Delayed or late payment is one of the biggest threats to small firms, particularly as obtaining credit has become much more difficult. In the survey, which was carried out in July 2008, 71 per cent of respondents claim that customers are taking longer to pay them. Although only 45 per cent are experiencing greater difficulty in obtaining credit, nearly all expect the credit crunch to adversely affect their business in the future.
“The Prime Minister keeps saying he is listening to the concerns of voters, but the results of our research show that small businesses believe he is bypassing their concerns when they most need his support,” said Nick Palin, the FPB’s director of Finance and Administration. “The government should be working more closely with small businesses in order to help them to navigate the stormy water ahead and the longer-term issues that will come in the aftermath of the credit crunch.”
David Ingall, president of the UK200 Group, said: “This survey provides concrete evidence that the credit crunch is really hitting UK SMEs – the backbone of our economy. The government needs to be listening – and talking – to smaller firms as part of its overall plan of action for turning the economy around, otherwise it may be too late for many businesses to benefit from a future recovery.”
The FPB publishes a guide, 'Costs, Controls and Profit, the Complete Business Checklist', which helps employers with every step of running a business. For more information about how the FPB helps its members, call the member helpline on 0845 130 1722, or visit www.fpb.org