Tories more supportive of enterprise, say business owners

Most small business owners think Tories are a better bet for entrepreneurs

4 January 2010 14:12

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More than three quarters of entrepreneurs believe they would receive more support under a Conservative government, a poll has found.

In a survey by mid-market private equity firm Bowmark Capital, 78% of small and medium-sized businesses said they felt the Tories represented a better bet for entrepreneurs.

Cutting red tape, simplifying employment law and maintaining low interest rates were cited as the priorities for the winning government in this year’s general election, in order to stimulate UK enterprise.

The survey, which quizzed 132 MDs and chief executives from small and medium-sized firms in the UK, also found that business confidence was bouncing back after hitting its lowest point eighteen months ago.

Bowmark’s ‘Optimism Index’ recovered by 6.4 points to 73.1 since July 2008. Most small business bosses expect the UK economy to begin a sustainable recovery this year, while around 89% expect their revenue and profits to grow.

“While historically it can take up to three years for activity to return to pre-trough levels, the entrepreneurs in our survey are more optimistic about a faster return to growth for the economy and for their own businesses,” said Charles Ind, Bowmark Capital’s managing partner.

However, the overall scores masked dramatic variations in the performances of different sectors over the past year, as well as their outlook for 2010.

Manufacturers fared significantly worse than service industries over the past year, with two-thirds reporting unchanged or lower profits in the past 12 months, more than 40% struggling to service debts and confidence continuing to fall.

In contrast, just 38% of business service firms saw static or lower profits last year, while overall they were found to be even more optimistic than they were two years ago.

Furthermore, although businesses across the board found it harder to access finance over the past six months, almost two-thirds of the manufacturers questioned were offered harsher terms for working capital facilities over this period compared to 44% of respondents overall.

“The small and medium-sized companies we surveyed have been through the wars in the past 18 months, with some sectors worse affected than others by the recession,” added Ind.