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BAB-39 November 2005 Analysis
The 39th UK Business Adviser Barometer Survey was shorter than usual, with only seven questions this time. Themes were: security problems, payment behaviour, cash flow, trading online and market research.
In total 218 Advisers responded to this Survey.
Survey Findings
The period October - December is the time of year when domestic robberies have recently been at their highest, and warnings are regularly given about homes being targeted for Christmas gifts and other new acquisitions. For businesses, this seasonality is not so obvious.
Although 34% of respondents to the survey decided that winter was the most vulnerable time for physical business crimes, 51% don't think there is a seasonal pattern.
We asked the same question in our parallel survey of Businesses, the UKBB. 25% of respondents to that survey think that winter is the most vulnerable time of the year for break-ins etc., even though 57% believe that there is no season in which firms are more vulnerable.
Compared to this time last year there are signs that large firms may be becoming slower to pay. 31% of respondents report more delay in payments, also 3% report significantly more delay. 63% find there has been no change. All of these are after elimination of 'not applicable' responses (18%).
The businesses responding to the UKBB were in broad agreement, with 37% finding evidence of more delay, plus 2% reporting significantly more delay, although 57% have not observed any change from a year ago. Again, these figures are after adjusting for 12% of respondents who chose 'not applicable' as their response.
Late payment by debtors is one of the factors contributing to weaker cash flows. UKBAB panellists were asked about their clients' cash flow positions. Only 9% of respondents thought it more favourable now, while 44% understand it to be less favourable.
In the UK Business Barometer survey, when asked if cash flow is more or less favourable than a year ago, 27% of the respondents said that it was more favourable, while 34% said that it was less favourable.
Advisers were asked what proportion of their clients currently have websites. 39% of respondents think that more than half of their clients have a website. This contrasts with the businesses responding to the UKBB survey, where the survey showed that 84% now have a website.
54% nd 20%.
Where there is a website, UKBAB panellists were asked if there was online trading. A very small proportion of advisers, 4%, reported that more than 50% of clients offer online trading.
The UKBB survey revealed that 7% of its respondents offer payment facilities and a further 6% are planning to do so soon.
There is growing evidence of the value of being able to sell on-line with some companies reporting over 20% of sales in this way. Both the UKBAB and the UKBB surveys asked what is the main barrier to establishing an online trading facility. Both sets of respondents see products that are unsuitable for web sales as the overwhelming factor, with around 63% in both cases, but of the remaining choices, set up costs were seen as a significant deterrent.
It is commonly believed that too little market research is carried out by smaller businesses. The reasons supposed for this include expense, difficulty, no need if the business is working well, too time consuming. 69% of Business Advisers responding to the UKBAB say that less than 10% of their clients undertake formal market research,
Asked whether they carry out formal market research regularly, 23% of respondents to the UKBB said that they did so.
Listed below are extracts from feedback into the November 2005 Survey BAB39
Views expressed are those of individual panellists and may not represent those
of the University.
Cashflow will be worse in January/February when tax payments have to be settled.
I deal with very small business entities. It feels as though more of them are having problems earning enough to pay suppliers and staff let alone giving the owners a reasonable return for the effort they put in.
The main obstacle to web trading is fear of the unknown on the part of potential web traders. Many are not confident to operate the IT side of it and others don't understand what they need to do to fulfil the orders.
One factor against on line trading is the lack of expertise within businesses to set up their own on line shops, the price then becomes prohibitive as they have to pay consultants for updates etc.
Merchant accounts for trading on line are difficult to get hold of for new businesses with no financial track record - banks
not really interested
Our clients are finding people are putting off expenditure asa they are trying to lower their borrowings .
Some businesses are web orientated but these are few because they are dealing face to face.
My perception is more vandalism in the long summer evenings, but perhaps more break ins in the darker, winter evenings!
