The most recent Entrepreneurs’ Forum Quarterly Members Pulse Survey has revealed that entrepreneurial optimism remains high, despite reports of lengthening sales cycles.
Of the 104 North East business-owners who responded to the survey, which was conducted by Explain Market Research, 83% are optimistic or very optimistic about business performance for the year ahead.
This high level of optimism can be attributed to entrepreneurs anticipating increased turnover, with three quarters of respondents expecting their turnover to increase over the next 12 months. While all growth is positive, the survey identified a slow down in the rate of projected growth.
We asked how the entrepreneurs expected to achieve their growth ambitions and over 80% believe there is untapped potential in their existing markets. Innovation remains central to growth plans with 55% planning to introduce new products and services over the next 12 months. Nearly one fifth of respondents plan to acquire as part of their growth strategies.
In order to grow, over half (59%) of entrepreneurs responding to the survey intend to hire in the next year. This is good news for the North East economy, although this represents a reduction in hiring plans compared to our previous survey findings. Getting the right people into entrepreneurial businesses remains a significant business challenge, with entrepreneurs finding recruitment difficult, particularly for skilled, well experienced and positive people.
Factors which are contributing to slower business growth include the elongation of the sales cycle, with members stating that deals are taking longer to close due to complex processes and slower decision making by customers. An entrepreneur in the engineering sector said: “Our clients are busy, but the procurement process has become increasingly complex and slow year on year.”
Other members highlighted increased competition in their sector, especially from companies outside the UK, resulting in a squeeze on prices. As well as this, some identified wider economic pressures leading to sales challenges, with companies being reluctant to invest and budgets reduced.
For the first time, the Pulse Survey also focused on members’ equality, diversity and inclusion (EDI) efforts, which revealed over three quarters of respondents think it’s important for their business to be a more inclusive employer and that they have already implemented company-wide EDI policies. Over half (54%) have taken personal action in the last 12 months to educate themselves on EDI.
Elaine Stroud, CEO of the Entrepreneurs’ Forum, commented: “With our member businesses generating revenues in excess of £1.25 billion, our survey results provide a strong insight into sentiment across the North East.
“The results shown in our latest survey confirm entrepreneurs remain optimistic about the year ahead, despite challenges around the sales cycle and recruitment.
“Yet amidst these hurdles, the commitment from our members to fostering equality, diversity and inclusion stands out, reflecting not just a dedication to business success, but to creating organisations that the North East can be proud of.”
The Entrepreneurs’ Forum was founded in 2002 and represents over 340 North East entrepreneurs.
Its partners include Agilico, Blu Sky, Hilton Newcastle Gateshead, LDC, Northumbria University, RBC Brewin Dolphin and Ward Hadaway.
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