CENTRAL SOUTH MID MARKET COMMERCIAL
ADAPTABLE
CHALLENGES BULLISH
The Mid Market – The Essential South
When, just over a year ago, we launched the second year of our campaign to champion the mid- market in the Central South, we believed the message was finally being heard loud and clear – these dynamic and growing companies are an essential part of the regional and UK economy, says Malcolm Thixton, lead partner at BDO LLP. This holds true, but mid-market businesses now find themselves operating in a period of unprecedented uncertainty in the UK and globally
It’s impossible to gauge the effect of Brexit on the mid-market locally and nationally at this stage. The full impact of the referendum on confidence and economic growth will depend on the length of negotiations with the EU to establish a clear route forward and whether foreign exchange rates remain volatile. However, we encourage mid- market companies to hold their nerve and continue with their investment plans.
We saw how resilient the region was through the last downturn. Many of the businesses we have talked to over the past year are not only in a strong position to
weather any economic storm, but flexible enough to respond to the opportunities a brave new world may bring.
Strong management and adaptability are two of the crucial attributes we have seen in the most successful mid-market companies identified in our ongoing focus on international expansion and profit growth. But they are also very apparent in the ‘fast-growing businesses’ breaking through the £10 million turnover threshold – the mid-market companies of tomorrow that will be crucial to the region’s long term- success.
Going global – do your homework
The biggest effect of Brexit will probably be felt in the international trade space. One thing the referendum highlighted was the overdependence of the UK on EU-related trade activities and one of the few things the opposing parties agreed upon was that the UK needs to expand its trade focus to other, emergent markets.
We previously discovered that whilst an encouraging number of the region’s mid-market businesses are looking at international markets for expansion, the majority are still targeting established markets such as North America and Europe. The much talked about renegotiations of
Profit growth – back to basics
BDO supports the mid-market nationally through its sponsorship of the Sunday Times Profit Track programme and, locally, we again identified the Central South’s top companies by profit growth.
Can these mid-market companies continue to demonstrate sustained profitable growth through economic uncertainty? We believe they are in a good position to do so with strong management teams who can recover quickly from, or sidestep any blows of
24
businessmag.co.uk
misfortune. Planning for all eventualities, speed of reaction, diversification and bold business model restructuring, can all help to change and control a company’s destiny. In several cases, we discovered successful companies have simply gone back to the basics of business – customer satisfaction, quality products and services, value for money – although talent, experience and technological advances have also played their part.
trade deals will now start in earnest and nobody knows how long the process will take or what the end points will be.
Mid-market companies in the Central South have told us that they want to be more focused on which markets to pursue.
How do they identify the countries beyond Europe that offer the best opportunities? Proper research at the outset is critical: Study potential destinations and their trading differences; and obtain advice from experienced and trusted sources, such as others who have done it and impartial professional advisers.
The Central South ‘powerhouse’
A final thought. Post the referendum and with a change in leadership, will the Government’s plans for geographic and sector powerhouses, so dependent on investment in improved infrastructure, now be under review? Overseas investment such as the £800m made by Bejing Engineering Construction Group in Manchester Airport may be harder to secure. Even with so much uncertainty, is devolution the chance for the Central South to create a stronger regional identity?
Straddling the SE/SW governmental boundary our economic region is historically fragmented, three separate Local Enterprise Partnerships, county, unitary, district councils and numerous other organisations vying to support and influence. The current proposals, whilst a step in the right direction, retain this divide. Is it time to finally create a unified voice to grasp the opportunities that will arise? A truly regional authority that can attract funding, deal with our own east-to-west connectivity challenges and enable us to compete with the UK’s other powerhouses?
Should the Central South be recognised by the Government as a full-fledged ‘region’ in its own right? Or, given the robust performance of the businesses and in particular the mid-market over recent years does it even matter?
THE BUSINESS MAGAZINE – SOLENT & SOUTH COAST – SEPTEMBER 2016
ENGINE
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56