Partner Article

Accessing funding remains problem for Yorkshire businesses

Access to finance remains the number one issue for Yorkshire’s businesses, according to a new survey carried out by Yorkshire accounts Garbutt & Elliott.

More than 200 Yorkshire and Humberside businesses across many sectors took part in the Access to Finance Survey, which was undertaken in conjunction with fellow accountancy firm Watson Burton.

The survey provided a snapshot of how businesses feel about obtaining external finance and their understanding of the financial options available. It also explored why it is so hard to secure funding.

Jeremy Oliver, corporate finance partner with Garbutt & Elliott, which has offices in York and Leeds, commented: “Despite the obstacles identified in the survey, there was also a refreshing degree of optimism. For example, respondents had raised more than £50m in the last 12 months and three-quarters of businesses are expecting to experience growth this year.

“Crucially, though, most companies (53 per cent) said a lack of access to finance was restricting their ability to grow. Many say finance is simply not available; others are put off by the level of control exerted by funders and the costs associated with getting finance,” added Oliver.

When asked to give more detail regarding their ability to access external finance over the past 18 months, almost 60 per cent said it had been difficult, very difficult or impossible. Just 18.5 per cent described the situation as very easy or easy, according to the survey.

Oliver explained: “Looking ahead, the landscape is positive with 55 per cent expecting to access funding for growth in the next six months. With two in three of these businesses seeking less than £500,000, alternative sources of funding should continue to grow.

“However, respondents lacked an understanding of how to access newer forms of finance such as crowdfunding, with their funding coming from the more traditional sources of friends, family and business angels.

“Significantly, the new CBI report Ripe for the Picking has highlighted no less than 13 new and innovative forms of finance such as peer-to-peer lending, equity investment, corporate venturing and retail bonds, together with the increased prevalence of well-known, but under-utilised types of finance, such as asset-based lending. These are exciting developments in the market.”

This was posted in Bdaily's Members' News section by Mark Lane .