Accessing Capital For Growth Still Major Challenge For North West Businesses

Accessing capital to fund growth plans remains one of the biggest challenges facing North West businesses over the next six months, according to accountancy and business advisory firm, BDO.

BDO LLP’s latest bi-monthly Economic Engine survey of 500 mid-market businesses, has revealed that almost two-fifths of regional businesses (37%) are struggling to secure funding, whether that’s through bank loans, private equity, private credit loans, or government grants.

The survey of mid-sized businesses has shown that despite inflation easing in recent months, reaching its lowest level for more than two years, regional businesses are still suffering from inflationary pressures.
Two-fifths of North West companies (40%) said declining customer demand, triggered by consumers spending less due to ongoing high living costs, as well as an increased number of B2B customers going out of business, was impacting their bottom line. This is reflected in the latest research by trade association R3, which shows that insolvency related activity in the region rose 4.7% when compared with the same period in 2023.

Angela Cross

Inflationary pressures continue to be a significant thorn in the side of North West businesses, with many still feeling the effects of stubborn energy costs and rising wage bills, amongst other things. As a result, access to capital is absolutely key to allowing these businesses to grow, but it is clear that there needs to be significant improvements in this area.

Despite trading conditions remaining difficult, the outlook for businesses is starting to shift. According to our survey, over three-fifths of North West businesses feel more confident about their business prospects this year, compared to the second half of 2023 when the UK recorded a technical recession.”

It is positive to see some optimism, but North West businesses cannot achieve their growth ambitions alone. The political landscape is still unclear but, whatever the outcome, regional businesses need to see better access to capital and a clear and comprehensive business tax roadmap for the next five years high up on the list of priorities.