In Focus: Stats the way to do it
Here at Insider we get a lot of research thrown our way, some useful, some spurious – so we decided to do some ourselves a year on from the formation of the coalition government.
Some 91 interviews were conducted with companies across professional services, manufacturing, construction, distribution and other sectors and this is what emerged.
Question one asked how profitable companies were compared to the previous financial year. Some 54.9 per cent said they were more profitable and 26.4 per cent said things weren’t as good. Breaking that down into sectors, three in four manufacturers said their profitability had increased.
Those respondents who had reported increased profitability were asked what they attributed this to. The top answer was increased sales performance whilst in second place was tighter control of costs.
Respondents who said their profitability had deteriorated were asked to give reasons why. The top answers here were government spending cuts, a drop in demand and customers cutting costs. One in three also mentioned an increase in their own cost base.
However, across all respondents 56 per cent said that the public sector cuts hadn’t had an impact on their business. Perhaps surprisingly only 44 per cent of construction firms said they had been affected by public sector cuts.
Turning to the thorny issue of bank finance. 22 per cent of respondents said they had found their bank inaccessible upon being approached to support their business financially. But around 50 per cent said they had found their banks accessible.
Where alternative funding has been sought 33 per cent said they had considered changing their banks and 19 per cent had looking at securing venture capital.
Looking at opportunities and barriers to growing their business – two in three businesses saw increasing their client bases as an opportunity for the future whilst over half saw an increase in sales and exports as crucial. The major threats to growth over the next year were perceived as the recession and a lack of confidence whilst an increase in costs and government cutbacks also featured highly.
And finally our business respondents were asked what one thing could make their business more profitable. More sales was, as might be expected, the obvious answer and access to funding was the third most popular answer. But interestingly in second place was a decrease in fuel taxes.
Is this research any more representative than the stuff we receive almost on a daily basis? Well, we’d obviously like to think so. The figure that really stands out for me, is that 50 per cent of companies think their banks are accessible. Could it be that those companies who secure funding from their banks don’t shout about it? Could it be that the banks are actually beginning to lend again? Or could it be that those who struggle to secure money from their banks are more vociferous? I feel another survey coming on…
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