12 October 2009
survey published today by Deloitte, the business
advisory firm, reveals that entrepreneurs are
evenly split in their opinion as to whether the
worst of the recession is over for their business.
Deloitte polled over 50 entrepreneurs during a
breakfast seminar at which James Caan, leading
entrepreneur and Dragons Den panellist,
and Keith Willey, Associate Professor from the
London Business School, discussed the challenges
facing entrepreneurs in the present business climate.
The snapshot of current entrepreneurial
sentiment reveals that:
- 35% believe the worst
of the recession is over, whilst 35% disagree;
- 86% believe their business
will emerge stronger from the recession;
- 80% say that steering
their business through this recession has made
them a better entrepreneur;
- 80% say the downturn has
provided new business opportunities for them
to exploit; 13% have not seen any new opportunities
for their business.
Debbie Griffiths, entrepreneurial
business partner at Deloitte, comments: The
results of our poll provide a very interesting
barometer of current confidence levels within
the entrepreneurial business community.
The speed at which
an entrepreneur-led business can react is often
the key to success. Indeed, 80% of those polled
say there are a lot of new opportunities in the
market place for a versatile entrepreneurial business
to identify and exploit. However, for many the
end to the economic uncertainty is still some
way off and when a recovery does appear, the economic
environment is likely to be radically different
to the past.
Keith Willey says: Many
larger businesses are currently internally focussed,
which presents numerous opportunities for entrepreneurs
to fill that gap in the market, which is often
in a niche area.
James Caan adds: As
with most businesses, entrepreneurs are having
to make some very tough decisions to reduce costs
and bolster their balance sheets, whilst also
trying to retain and motivate their top talent.
Offering key employees a piece of the action is
arguably one of the best motivational tools available.
This demonstrates to that employee their importance
to the business, and secures long term commitment.
Debbie Griffiths notes: One
way to achieve this is through, for example growth
shares, which does not necessarily dilute
existing shareholder value. There are some attractive
tax advantages when compared with cash remuneration
too, particularly with the introduction of the
50p tax rate from 6 April 2010.
Ian Stewart, chief economist
at Deloitte, adds: Entrepreneurs remain
deeply divided on the outlook for recovery. There
is no consensus among smaller businesses on the
recovery. This uncertainty tends to fit with the
views of central banks and policymakers who remain
overwhelmingly cautious about prospects for recovery.
The malign effects
of the recession are very obvious and well understood.
But what comes out of our poll is that the downturn
has also created new business opportunities for
entrepreneurs. Far from laying the smaller and
growing businesses to waste, 86% of entrepreneurs
in our poll believe that their businesses will
emerge from the downturn even stronger."