The fact that the government is expected to announce that the UK’s economy is officially out of recession, shortly, has provoked both economists and journalists to assess the main results of the ‘credit crunch’ on business as they see it.
While its clear that the recession has had a number of far reaching consequences for UK business – the number of employees considering company formation has increased, redundancy has risen exponentially and crucially many companies have gone into administration – what many commentators have failed to address up to now, is the fact that recovery from the recession will also have an impact on businesses in the UK. Namely, the fact that economic recovery will now create a more competitive context for enterprise.
According to a report commissioned by the SME Forum, over 60% of all small business owners feel that competition within their sector will now increase. Mark Andrews, small business advisor comments; “The recession has presented many challenges to the SME sector. Businesses that have survived, will undoubtedly emerge from the recession more cost efficient and ready to grow. However, as the barrier to market entry lower, these businessess may have to be prepared to do battle to for market share.”
Over 50% of all the 700 companies asked are concentrating on increasing their market share in 2010, 25% are planning to stabilise their cash flow while the remainder are focusing on recruiting new staff.