(10 March 2009)

Opportunities can be born out of adversity. Those who suddenly find themselves out of job or disaffected by the recession may well take matters into their own hands and decide to follow their entrepreneurial dream. With the largest reduction in GDP expected since 1946 in the next 12 months and unemployment levels set to rise to over 3.25 million by the end of 2010, according to Ernst & Young’s ITEM Club, the recession may well be the catalyst for the next generation of UK entrepreneurs.

They will follow in the footsteps of Bill Gates who founded Microsoft in the recession of 1975, James Dyson who launched his vacuum company in the early 90’s and Hewlett-Packard which was born in a garage at the end of the Great Depression. Start-ups will be riding against cautious investors reluctant to lend, but the best ideas backed by a creative and persistent leader can get funding and be given the chance to prove themselves.

Stuart Watson, partner at Ernst & Young said: “The current environment is creating opportunities for entrepreneurs. It is easier to hire skilled labour and find available premises to let for new businesses. Those most likely to succeed are those with small start-up costs, quick routes to market and most importantly, those that will deliver to customers cash savings.”

Founder of MKM Building Supplies Ltd and Ernst & Young’s North Entrepreneur of The Year 2008, David Kilburn, was made redundant a few days after his 50th birthday. Spurred on by necessity David started his own company in 1995, which is now one of the largest builder merchants in the UK. “Redundancy came as a shock,” said David. “I was motivated not only by putting food on the table but also I wanted to show what I was capable of. I think I was always a closet entrepreneur, I never liked people telling me what to do,” added David.

Kilburn drew on contacts and friends he had built up over 32 years in the industry and with a team of five and his wife, a management consultant, the ‘grand plan’ for MKM Building Supplies was born at the kitchen table at David’s home. MKM turned over £135,000 in its first month. With 37 branches and employing more than 600 people, turnover now stands at £132million.

“There will be opportunities to enter the market in the next 12 to 18 months for budding entrepreneurs. It’s all about when is the best time. My advice to others; successful entrepreneurs are cautious risk-takers rather than gamblers; ‘cash is king’ – don’t start off by under-funding; and businesses are built on reputation – pay your bills on time and don’t tread on people on the way up, you never know when you might need them on the way down,” added David.

Routing for entrepreneurs

The new champions of the economy – the UK will be relying on the ‘go-getting’ talents of entrepreneurs. “Entrepreneurship is an incredible force. It is the engine of growth, jobs and opportunity and will play an important part in re-energising our economy. It has never been more important to recognise the achievements of our entrepreneurial community in the UK,” commented Stuart Watson.