The second Entrepreneurs’ Forum survey for 2023 has revealed that entrepreneurs are focused on growing revenue and improving profitability rather than selling up.
A hundred business founders responded to the Quarterly Members Pulse Survey which indicated a positive outlook amongst North-East entrepreneurs with regard to growth plans for the next 12 months.
Just over three quarters of respondents are expecting to expand through existing market growth, while 47% indicated that the introduction of new products and services will contribute to their growth in the coming months.
Nearly 20% of businesses are looking to grow through acquisition, a 3% increase since the last survey in February 2023.
With a collective turnover of in excess of £1.25 billion from Entrepreneurs’ Forum member businesses, these positive indicators of growth are good news for the North-East economy.
The survey, conducted independently by Explain Market Research, also revealed that the biggest challenge facing North-East businesses continues to be people related, with nearly half of respondents stating that finding staff to fill roles remains difficult.
Only 15% of respondents said they were concerned about staff pay and benefits, which represents a significant drop from the 49% who stated this was a concern in the last quarter.
This appears to indicate that salary negotiations for the coming year are mostly complete and inflationary pressures on wages are easing.
Survey respondents also indicated sales to be a key challenge, plus the cost-of-living crisis and rising labour and utility costs.
Insight into the future plans of the region’s entrepreneurs and their exit strategy highlights that nearly half of the entrepreneurs who participated in the survey have no plans to exit their main business.
It seems unlikely that 2023 will be year of major exits as entrepreneurs are more focused on achieving revenue growth and profitability improvements, than selling up.
Those looking to exit typically stated that they would look to do so in over three years’ time which may indicate a belief that the markets conditions will allow for higher valuations from 2026 onwards.
Entrepreneurs’ Forum CEO Elaine Stroud (pictured above) said: “The results of this quarter’s survey are a good indicator of business trends in the region.
“I’m particularly interested to see the commitment to grow revenues in the coming 12 months.
“Entrepreneurs are resilient and are not giving up and selling out, despite challenging trading conditions.
“They see the potential to achieve turnover growth and profitability improvements and are determined to realise the potential of their businesses before considering their exit strategies.
“From these results I expect to see a buoyant quarter amongst our members.”