Business News Round Up (17/01/2024)
UK businesses strive for growth amid possible recession, third annual J.P Morgan survey finds
UK business leaders are meeting optimism with caution as four-in-ten (42%) are preparing for a possible recession or believe we are already in one, which is down 25% from 2023, according to J.P. Morgan’s third annual UK Business Leaders Outlook survey. In a survey of nearly 300 C-suite executives from UK businesses, optimism around company (82%) and industry performance (75%) has increased over the past year, and as a possible result, decision-makers are expecting revenue and sales to increase in the year ahead (78%). However, despite their confidence, less than half remain optimistic for the global economy (48%) and national economy (43%) as persistent challenges continue to create hurdles for business leaders. Rising interest rates (40%) and uncertain economic conditions (38%) are among the top challenges for UK business leaders, with more than three quarters of respondents citing inflation is increasing the cost of doing business (79%).
£10m boost announced for North West SMEs, creating ‘in excess of 700 new jobs’
North West based fund manager River Capital has secured a new injection of £10m from Greater Manchester Pension Fund (GMPF), and delivered by private credit investor TDC, to further scale its North West Business Growth Loans Limited (NWBGL) product offering. Established by River Capital in 2022, NWBGL provides an alternative form of loan finance to SMEs in the North West, complementary to more traditional sources such as banks. The increased funding reflects the significant demand received to date and is in addition to the existing £8m originally committed from cornerstone funder MSIF. Loans are available to trading SMEs operating in most sectors, and can be used to support working capital, capital expenditure, acquisitions, management buyouts and other growth related activities. Particular focus will be on applicants who demonstrate evidence of strong social impact and positive ESG outcomes as a result of the finance.
5% year-on-year fall in Scottish insolvencies
In December there were 108 company insolvencies registered in Scotland, 5% lower than the same month in 2022. According to the latest official Accountancy in Bankruptcy figures, this was comprised of 40 compulsory liquidations, 65 creditor’s voluntary liquidations and three administrations. There were no compulsory voluntary arrangements or receivership appointments. Between 26 June 2020 and 31 December 2023, in Scotland, no moratoriums were obtained, and two companies had a restructuring plan registered at Companies House. Michelle Elliot, restructuring advisory partner at FRP in Glasgow, commented: “High interest rates, unrelenting energy bills and spiralling operational costs mean Scottish businesses across a wide range of sectors have come into the new year facing a myriad of liquidity and cashflow challenges. Although December brought a slowing in insolvency rates, we’re expecting them to increase further in the months ahead.”
https://www.insider.co.uk/news/5-year-year-fall-scottish-31891639
Falling consumer spending a top concern for North West businesses, as companies brace themselves for challenging first quarter
A fall in consumer numbers and spending remains a top concern for North West businesses, as companies brace themselves for a challenging first quarter of 2024, according to accountancy and business advisory firm, BDO. BDO latest bi-monthly Economic Engine surveyof 500 mid-market businesses, revealed that 40% of regional businesses rank dwindling customer numbers and a reduction in spending as one of the biggest challenges facing their business over the next six months, as inflation and the high cost of living continue to hit customer pockets. The regional trend is also mirrored in the retail sector, with 37% of retailers placing this as their number one concern. It follows the latest BDO High Street Tracker that shows total like-for-like retail sales were negative in the last three months of 2023, the so-called ‘Golden Quarter’, pulled down by poor fashion sales as customers held back on their discretionary spend.