Page last updated at 00:17 GMT, Tuesday, 20 January 2009

Small firms fighting the economy blues

David, hotelierCarl, shopkeeperMark, solicitorJames, clock-maker#Louisa, cider-makerSteve, chocolatierHarry, joinerLeo, designerMike, lodge-makerJenny, dental goods maker

December was a tough month for one of the 10 small firms that the BBC News website is following throughout the economic downturn.

Manufacturing firm HMS Joinery was forced to lay off three members of staff, and admits that signs for the coming year "aren't good either".

Yet while the UK economy continues to look bleak, other panel members say they are holding up well.

Here are their reports for December.


David Groocock runs the St Maur Hotel on the Isle of Wight (IOW), which has an annual turnover of 200,000 and employs six people.

He is a member of the local chamber of commerce and the chairman of the IOW tourist board.

David Groocock
Confidence in the business - 8 out of 10. Up from 7/10 in November
Key current concern - Bank support for small businesses

"December is the month where we close for any maintenance and, of course, a much-needed holiday.

As I follow UK tourism generally, I am optimistic that UK holidays will do well this year.

It is all looking very positive for my business, and early indications are good - January bookings are already slightly up on 2008, and interest for the rest of the year is already showing signs of being upbeat.

My relationship with the bank is good, and they are fully supportive of my business plan for this year.

I remain concerned about the wider economy and can only hope that small businesses like mine can weather the downturn."


Carl Bradley runs a computer shop with his wife in Eastbourne, East Sussex.

Fusion Systems shop
Confidence in the business - 8 out of 10. Up from 5/10 in November
Key current concern - my banks are pressuring me to make more money or I will lose my services or the rate that I pay will go up

He employs three people and the business has an annual turnover of 540,000.

"December wasn't too bad, about 15% down on last year.

We have started to refit the shop and trade has soared.

I would recommend to any shop or business that they get active and make it look they are here to stay.

I've done no price cuts and at the moment, trade is very good."


Mark Stimson is a director at BPL Solicitors in Dorchester, Dorset, which specialises in property law.

The firm has an annual turnover of 2.5m and there are just under 40 employees.

Mark Stimson
Confidence in the business - 7 out of 10. Up from 6/10 in November
Key current concern - banks' refusal to increase lending levels

"We had a much better December than November, which is unusual in terms of seasonal activity, but it just goes to demonstrate how bad November actually was.

Our marketing initiatives are starting to bear fruit, and in view of the promise of at least a limited amount of increased availability of mortgage funds, we do not expect things to get any worse.

Having said that, we are still in a far from ideal position, with fee income running at about 25% of where we were at our peak in mid-2007, and we still have to look seriously at further cost cutting."


James makes and sells high-end grandfather and grandmother clocks in Armagh, Northern Ireland.

He employs five people and the clock-making company has an annual turnover of 180,000.

James Stewart
Confidence in the business - 8 out of 10. No change from November
Key current concern - low interest rates hitting the spending power of people who rely on their savings

The clocks retail from 1,660 to 10,000.

"December panned out as expected - steady to begin with and a last-minute flurry in the week leading up to Christmas.

January is going to be difficult to call as there is so much pessimism out there, most of which has been amplified by the media.

On a positive note, we still have a fairly healthy order book for both the international and domestic markets, and New Year enquiries are encouraging.

The currency situation will certainly help with export sales and reduce the affect of import competition. The flip side to this is that our material costs are increasing quite considerably."


Louisa Sheppy runs Sheppy's Cider, a family-owned Somerset cider-maker.

Louisa Sheppy
Confidence in the business - 7 out of 10. Down from November's 8/10
Key current concern - people's continuing spending power

It now supplies most supermarkets in the South West, and some nationally, but remains a small producer in the wider cider industry.

"Despite endless gloomy news, Christmas has been a busy period for us for both on and off-farm sales.

Changes in VAT in the run-up to Christmas were for us, as for every business, a substantial amount of unexpected work, from which I can see no real prospect of benefit to the consumer.

An increase in excise duty at the same time seems largely to have gone unnoticed and has certainly wiped out the VAT benefit on alcoholic beverages.

We are now entering a traditionally lean period when businesses catch up with maintenance and procedural and product reviews.

There is no doubt that producers and suppliers will be under downward pricing pressure from the multiples and their larger customers as they compete in an ever tighter retail market.

Our ciders are, and have traditionally been, at the quality end of the market and are not the cheapest available, so we are concerned that we will take our share of the downturn as some customers switch to cheaper alternatives."


Steve Valentine runs a confectionery factory that produces a range of chocolate and fudge products, as well as rock and sweets sourced from the local area.

Steve Valentine
Confidence in the business - 8 out of 10. No change from November
Key current concern - the number of retail multiples closing

It is based in Gwynedd in Wales.

The factory has 27 employees.

"We saw no slowdown in sales during December, and an overall increase in sales of 6% over 2007 for the year.

"Our key concern is still without doubt the number of High Street multiples who are experiencing severe financial trouble."


Harry Murray runs a manufacturing company that makes wooden staircases and other architectural features in Newcastle-under-Lyme, Staffordshire.

Harry Murray
Confidence in the business - 4 out of 10. Down from November's 5/10
Key current concern - More support needed from banks and the government to support small firms

Now employing 22 people, HMS Joinery has an annual turnover of 1.7m.

"There wasn't much Christmas cheer at HMS Joinery - I had to lay off a further three people.

The signs for the coming year aren't good either, but you have to stay positive and can't be dragged down by the negative thoughts of the media or so-called economists.

As far as I'm concerned, there is work out there, but not as much as before."


Leo White runs a design company in Cumbria. He employs five people and has an annual turnover of 250,000.

Leo White
Confidence in the business - 8 out of 10. No change from November
Key current concern - quality rather than quantity of new clients

He deals a lot with small start-up companies and has about 120 clients on his books.

"December was pretty busy for production, but a little quiet on sales and the long Christmas break compounded this.

A few good leads came in between Christmas and New Year, so we're working hard to follow these up and make the most of them.

Mentally as a team, we've become much more focused on quality of new business rather than quantity, and we're working hard to look after our existing clients and do more business with them.

Keeping our cash flow solid is hard work and with our office move over Christmas, it's not been a particularly stress-free Christmas, but then I didn't expect it to be.

On reflection, 2008 was a long hard slog, but for us at least we achieved a lot of growth and learned a lot in a small time, so I see it as a positive year.

We're still optimistic about growth in 2009, but with a more structured and considered approach than in the past."


Mike Grant
Confidence in the business - 7 out of 10. No change from November
Key current concern - maintaining continuity of current programme and catering to the changing market

Mike Grant runs a residential and commercial timber lodge manufacturer in Perth in central Scotland.

There are 21 people employed in the company, which has an annual turnover of 2m and produces about 30 lodges a year.

"We were shut for two weeks over Christmas and New Year, so nothing new really to report.

We are now very much working towards the Scottish Caravan and Outdoor Leisure Show in Glasgow from 5 to 8 February."


Jenny Lees produces dental products for dentists and the public from her base in Preston-on-Wye, Herefordshire.

She employs five people at the company, which has an annual turnover of between 300,000 and 400,000.

Jenny Lees
Confidence in the business - 8 out of 10. No change from November
Key current concern - suppliers remain in business

"December is always a difficult month to gauge.

Dentanurse supplies product to dental surgeries as well as direct to the general public.

As many dentists take the opportunity to get away over the Christmas and New Year period, so sales to that section of the business tend to ease off.

In contrast, sales of our products to Sainsburys, Asda, Boots, Lloyds Chemists etc have gone up.

This is because while dentists are skiing or sunbathing for two weeks, their patients are dislodging crowns by cracking festive walnuts with their teeth and pulling out fillings on chocolate-covered toffees."

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Small firms fighting the downturn
11 Nov 08 |  Business

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