16 focus on southampton
Time to encourage those green shoots of recovery in the south
RSM Tenon’s John Taylor freely admits that he is no gardener, but as a chartered accountant he knows when conditions on his patch are right for spring growth – among businesses in the Solent area that is, writes John Burbedge
“People talk about a zombie-company culture, but we have still got a significant number of businesses in this area that are doing very well and showing year-on-year growth. And some businesses are now looking to grow, even though they are still taking chunks out of their cost base.“
There is appreciable business activity taking place in the Solent region, but it is not being recognised and given enough support, says Taylor, RSM Tenon’s Southampton office managing partner.
He also blames a recessionary business mindset – maintained by downbeat national media coverage – for the lack of current growth.
“We know that everything in the economic garden is not rosy, but we should spend longer looking at what’s in bloom or going to bloom, rather than dwelling on the negative stuff that needs cutting back or is in the autumn of its life.“
RSM Tenon is a corporate champion of Business Solent and Taylor applauds its work promoting economic awareness and drive for the Solent region as a place to work, invest, study, live and enjoy. However, Taylor thinks more local businesses could help, particularly with a change of mood.
“There are too many people clinging to a history of double-digit growth. Today, if we see 2-3% growth year-on-year we should recognise that as a good result in the current economic climate. Let’s focus on actual positive performance rather than potential negatives ahead.
“We should be upbeat. Southampton, for example, with successful businesses, low unemployment, strong communication links, plentiful labour supply, and sensible costs from local councils, is a good place to do business and achieve long-term prosperity.
“And, our region is continuing to grow; providing a positive contribution to the UK economy.“
Within RSM Tenon’s Southampton office there are further encouraging signs. The firm’s medical sector client base (over 1,000 GPs, 165 medical practices) is vibrant. “We are growing because people want first-rate support and specialist advice in a complex area.“
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Corporate finance and M&A activity is also growing. “Deals are being made, but, due to greater caution they are simply taking longer to complete.“ Corporate recovery work has been steady and insolvencies do not appear to be increasing dramatically.
Taylor, president of the Southern Society of Chartered Accountants, says that fellow SOSCA members will know many companies doing well in their chosen fields. “But a lot of companies are too down on themselves. People need to stop getting hung up on the monthly and quarterly figures. Yes, our overall economy has shrunk; now we need look to the long-term, and support those who will grow it back.“
’Southampton ... with successful businesses, low unemployment, strong communication links, plentiful labour supply, and sensible costs from local councils, is a good place to do business and achieve long-term prosperity’
One supporter of those companies seeking growth will be RSM Tenon, pledges Taylor, who heads up the 160-strong team of professionals based at Eastleigh.
“Nationally we are the largest service provider to the OMB and SME marketplace. We also act for start-ups right through to some of the best known businesses in the area, such as worldwide logistics company PSP, sponsor of the PSP Southampton Boat Show.
“We can help with all aspects throughout the business lifecycle, from formation and successful evolution with its funding, tax and compliance work, up to the ultimate sale of a business,“ adds Taylor.
Already encountering extra work from businesses beset by increased HMRC requirements, Taylor expects the Southampton office to be even busier when Real Time Information (RTI) reporting is implemented for SMEs in April. Outsourcing payroll provides SMEs with comfort in respect of HMRC reporting as well as confidence that they are technically up to date and no longer
having to worry about holiday and sick cover in a complex area.
PE houses and banks are open for business however funding remains difficult, says Taylor. “Businesses are now prepared to trade and take entrepreneurial risks but growth only comes if you have suitable investment from external parties. Well presented business plans and more confidence among funders are needed.“
With its coastal location the Southampton office is keenly involved with international and export businesses. “Although everyone thinks of Southampton as synonymous with its thriving docks and cruise liner industry, I still believe that the local business community – with its high-standard technologies and niche manufacturing – doesn’t fully leverage the advantages of this external focus, this natural gateway to Europe and beyond.“
Quoting RSM Tenon research, Taylor pointed out that over half the monetary value of UK’s exports comes from SMEs, yet: “Of the SMEs surveyed in the south, 50% have not even considered exporting, which is surprising considering the strength of overseas markets compared to the domestic market and economy.“
Details:
John Taylor, office managing partner 023-8064-6404
john.taylor@rsmtenon.com
RSM Tenon offices
Southampton – 023-8064-6464 Basingstoke – 01256-312312 Reading – 0118-9530350
www.rsmtenon.com
THE BUSINESS MAGAZINE – SOLENT & SOUTH CENTRAL – MARCH 2013
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