Barnsley & Rotherham Chamber has warned that the outlook for many businesses operating in the region remains precarious, with inflation, rising labour costs and higher taxes all impacting their growth plans.
Research produced by the South Yorkshire Chamber’s Quarterly Economic Survey revealed that although more than half of the businesses said they felt more optimistic about the future, just a third said their cashflow position had improved during the past three months, while 23% said their financial position had worsened.
The survey also revealed that businesses have adopted a cautious approach to raising finance as a means of driving business growth. Despite 58% of companies reporting that they are working below capacity, 70% of businesses said they were not currently looking at ways of raising finance.
A total of 25% of businesses said they felt it would be unlikely that they would be successful in securing finance, with 83% likely to approach their bank in the first instance. However, less than a third were aware of alternative funding providers operating in the region.
According to data published by the South Yorkshire Mayoral Combined Authority, businesses in South Yorkshire lag behind many areas of the UK, resulting in lower productivity and economic growth.
Matthew Stephens, President of Barnsley & Rotherham Chamber, believes that one of the main reasons businesses chose to place investment and growth plans on hold was due to them adopting a “wait and see” approach when it came to the Chancellor’s Budget and the US presidential election.
Responding to the survey findings, Shaun Connell, Marketing Manager, Business Enterprise Fund (BEF), a member organisation of Barnsley & Rotherham Chamber specialising in business lending said: “The South Yorkshire Chamber’s Access to Finance Survey highlights a significant challenge faced by many local businesses, particularly those that are women-led, minority-owned or based in underserved areas.
“The findings of the QES survey revealed that less than half of the business owners interviewed were aware of the different ways in which businesses can raise finance, beyond high street lenders.
“Accessible finance plays a vital role in fostering business growth and innovation. Addressing barriers to growth requires collaboration between businesses, support organisations and financial institutions to ensure that all business owners are aware of, and able to access, the funding options available to them.
“We actively encourage ongoing dialogue and action to improve the visibility and accessibility of finance, helping businesses across South Yorkshire to thrive, by providing the vital funds needed to safeguard jobs, boost the local economy and support communities.”
Matthew Stephens, President, Barnsley & Rotherham Chamber, said: “It is clear from the findings of the survey that although business confidence has increased slightly since our last survey, many businesses continue to work below capacity.
“The data indicates that many businesses are delaying investment decisions, possibly in expectation of lower interest rates, as well as understanding how decisions taken during the Budget will impact their future plans.
“Access to finance can play a vital role in unlocking business potential, as well as acting as a catalyst towards driving growth and job creation. The survey clearly highlighted that businesses are unaware of the different ways in which they can access financial support, with 48% of businesses saying they would be open to exploring new ways of securing future investment.
“However, with just 36% of businesses reporting increases in cashflow, it is clear that many are waiting to see how the Chancellor’s Budget announcements are likely to impact their business before committing to any major new investment plans.”
The Quarterly Economic Survey took place between 19th August and 16th September and saw 146 businesses from across South Yorkshire participate.
