It’s not all gloom and doom here
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THE credit crunch may be continuing to bite many UK businesses, but a new survey out today has found that three-quarters of family-owned firms in Grampian have felt no impact. The poll, carried out by chartered accountant and business adviser Johnston Carmichael, also discovered that all participants were positive about the outlook for business generally in 2008.
Brian Moran, a partner with Johnston Carmichael in Aberdeen, said: “The portents of gloom and doom currently surrounding the business pages of certain media do not appear to be the views of family firms in Grampian.
“We polled a panel of local family-owned businesses operating across a variety of sectors to provide a snapshot of the issues affecting them. It is heartening to see that they were 100% positive regarding the business outlook for 2008.
“Although there is still much talk in the media of businesses feeling the negative effect of the so-called ‘credit crunch’, that doesn’t appear to be the views of family businesses in the Grampian region.
“Our corporate finance team also believes that the credit crunch is not affecting the Scottish economy as much as the rest of the UK.
“There are still a large number of Scottish corporates pursuing strategies of growth by acquisition, and the banks don’t seem to be curtailing lending for the right deal or for companies with a strong financial position.
“This said, the general consensus is that the era of easy credit is at an end, with banks taking a tougher stance on pricing and tightening up on lending criteria.”
Firms were also asked by Johnston Carmichael about recent changes in capital gains tax (CGT) which led to a flood of small owners selling up to escape paying more tax.
Mr Moran said it was surprising that everyone who took part in the survey said the CGT changes had no relevance to their business.
He added: “It can only be assumed that this is due to the respondents having no desire to exit their firms at this time, as the level of activity within our corporate finance and tax departments in the lead-up to April 5 would suggest that a large number of businesses wished to take advantage of the 10% CGT rate.”
The poll also found that the key risks for the family-owned sector in the Grampian region are operational and economic.
Three-quarters of respondents stated that rising travel and fuel charges had affected their business.
Mr Moran said: “The north-east economy, in general, is heavily dependent upon the transport of goods and people to and from the region, and specific industries, such as fishing, agriculture, haulage and oil services, bear the brunt of fuel price rises as it is core to their daily operations.
“On the subject of transport, the majority of our panel believed that the planned Aberdeen western peripheral route would be beneficial, and even those who didn’t believe it would impact their business stated that the delay of the plans was ‘doing nothing for the credibility of the north-east’.”
Mr Moran said that survey participants said the strategy for their firms was to build the business, and they had plans for growth through expansion and/or acquisition.
“None of them were content with simply maintaining the current level of business,” he added.
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