Businesses forward-looking despite the economic slowdown

9 October 2008

British businesses are still planning to grow even though they admit to being hit by the credit crunch and the slowdown in the economy.

According to the latest annual UK Enterprise Survey Report 2008 from the Institute of Chartered Accountants in England and Wales (ICAEW), some 65 per cent of UK businesses have reported that the credit crunch has had a negative effect on them.

However, despite this 83 per cent of respondents said they still have ambitions to grow.

Growth plans among businesses of every size and from every region seem not to have been tempered by the financial turmoil, by recent rises in raw material costs or by uncertainties over customer demand, the report found.

The average annual target growth among those businesses planning to expand is 12.4 per cent for this year compared with 13.4 per cent last year.

Clive Lewis, the ICAEW’s head of SME issues, said: “Nobody can yet tell what the impact of the current turbulence in the financial markets will be on the broader economy. Businesses know that the climate isn’t going to improve in the short term – yet despite this and after all that they have had to respond to in the last twelve months, they remain focussed on growth and profitability.”