High costs and difficulty accessing capital continue to stifle growth for Thames Valley businesses, according to new data from accountancy and business advisory firm BDO.
Its latest bi-monthly Economic Engine survey of 500 mid-sized businesses has revealed that cost pressures will remain a significant challenge for regional companies over the next six months, with 60% of businesses saying they are concerned about higher operational costs, including rent, energy bills and the cost of borrowing.
Nearly half of regional businesses (43%) admit that sourcing new capital from private and public sources is a top concern, with almost two-thirds (63%) stating that they will struggle to expand their business in the coming months, through entering new markets or increasing their physical footprint.
Ahead of the forthcoming Spring Budget, Thames Valley businesses are calling on the Government to address ongoing issues around costs, skills, and taxes.
The survey showed that half (50%) of regional businesses are calling for better access to private capital and government grants.
A third of Thames Valley businesses (33%) still believe the Government should offer greater support to resolve ongoing staff and skills shortages, including reforming the Apprenticeship Levy and placing greater focus on helping working parents.
David Brookes, regional managing partner at BDO in Thames Valley, said: “In what could be the last Budget before a general election, the Government has a real opportunity to place growth and the interest of businesses at the centre of its announcement.
“Time and again, Thames Valley businesses have called on the Government to act with greater purpose on key areas such as costs, access to capital, and skills.
“However, tax remains a real thorn in the side for regional businesses they want to see more Government resources to help businesses in the mid-market, including within HMRC.
“What’s more, Thames Valley businesses want long-term reform to streamline or lower business taxation, such as overhauling business rates, or cutting corporation tax.”
Despite the calls for reform, businesses in the region do not anticipate a reduction in corporation tax in the near future, with more than half (57%) believing the overall tax burden on their business will remain the same between now and 2025/26, and two in five businesses (40%) anticipating that it will rise.
Brookes added: “Encouragingly, when you place the Budget and Government support aside, the appetite for growth from Thames Valley businesses remains strong.
“Our survey shows that the key to growth for many businesses over the next six months will include workforce improvements, business investment, and supply chain efficiencies.
“There’s no doubt that trading conditions remain extremely difficult for Thames Valley businesses, with significant challenges remaining.
“However, with the right support from the Government, mid-sized companies in the region will continue to be the driving force behind the UK’s economic recovery.”
