Wednesday, December 18, 2013

News: Hart Shaw reports on increased optimism

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Hart Shaw Chartered Accountants & Business Advisers has reported that many companies are now looking to invest in long term strategic plans.

The Sheffield Business Park firm is working with a number of businesses that are making significant investments in long term projects through the Sheffield City Region Local Enterprise Partnership (LEP) and the Regional Growth Fund.

In July the LEP was conditionally awarded £7m from the Government fund to support modern manufacturing and technology companies to create jobs as a follow up to the successful £25m bid secured in round three of the fund.

The "Unlocking Business Investment" programme provides grants of between £25,000 and £2m to support companies using their own funding to make direct business investments that ultimately lead to creating sustainable, private sector jobs. Business investments include capital projects which involve investment in equipment, machinery and tools; alterations to land and/or premises to meet the needs of the business. Grants can also be used to support new research and development.

Calls for projects closed in November and the latest round of the programme included a new sub-programme with £2.5m set aside to support smaller businesses.

Steve Bell, head of corporate finance at Hart Shaw, said: "Whether this investment is through additional resources, new product development or infrastructure it is clear that what sets these businesses aside is each has clear Sustainable Competitive Advantages in their own markets. Whether these advantages are based on service levels, quality of products or technical ability, it is businesses like these who will reap the benefits of growth in the economy."

Despite the increased optimism, Steve warns that banks are still highly cautious when it comes to credit and that "Zombie companies", those barely surviving, will find that working capital restrictions will force them over the edge.

Steve added: "The final quarter of 2013 has seen an improvement in the level of optimism in the economy but this improvement does bring its own challenges. It will be interesting to see whether the continued optimism does start to deliver strong growth. It will also be interesting to see if the major banks can finally get their houses in order and support the experienced relationship managers who work with their clients."

Hart Shaw website
Sheffield City Region LEP website

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