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Home Weekly Business<br />E-newsletter ebusiness weekly news 29/09/2017

Firms at risk from 'locking up too much cash'

Businesses in the East of England have increased the amount tied up in ‘excess working capital’ to £27.9 billion, - a rise of 13 per cent since May - leaving them at risk if growth slows in coming months, says a report from Lloyds Bank Commercial Banking. It says recent sustained growth and the fall in the Sterling has increased the amount of cash tied up in the day-to-day running of businesses and suggests firms could struggle to free up cash either to grow or to weather turbulent financial conditions. However Karl Leitelmayer, area director for Lloyds Bank global transaction banking in the East, said: "The East of England is the only region in the country that has seen its working capital index reading fall during the past six months (from 112 to 107.8). While this is good news, as it suggests that businesses are recognising the potential challenges on the horizon and are choosing to manage their working capital more closely, firms in the region are still facing pressure to increase working capital.” He added: “By locking up cash in this way, it stops investment in other more productive areas of the business, whether that be investing in new people, creating new products or targeting new markets.” Nationally, one in four businesses said their customers had taken longer to pay during the past 12 months, increasing the value of firms’ outstanding invoices. At the same time, businesses are continuing to rapidly build up inventory, leading to more cash being locked up in stock.

Insolvency risks on the rise in the region

More firms in the region are at a ‘greater than normal’ risk of insolvency than at any point this year, with most sectors facing higher risks, according to insolvency trade body R3. Thirty per cent of businesses in the region  – some 102,000 companies - are now in an ‘elevated insolvency risk band’, a rise of 3.2 per cent on last month and up nearly six per cent rise up on a the start of the year. Tech and IT firms are at the highest risk. Some 38 per cent of firms carry an ‘above average’ possibility of insolvency. But the region’s agriculture sector is more financially stable than elsewhere in the UK. R3 Eastern chairman Mark Upton, a partner at Ensors Chartered Accountants in Cambridge, said: “The last quarter of 2017 will be an important test for East of England businesses. Many larger firms have been protected from the pound’s recent falls by currency hedges or long-term fixed-price contracts, but these are now unwinding or have since unwound. Businesses of all sizes have also been buoyed by resilient consumer spending in recent months, but much of this is on the back of increased borrowing.“

Briefly…

Digital skills in demand

Strong demand for digital skills in the East of England means that employers in the region are willing to more than elsewhere in the UK for workers with word processing, data analysis and social media capabilities (£11,701 vs.  £10,000 for “expert” digital skills, and £4,575 vs. £3,000 for “advanced” digital skills) according to research from Barclays. The bank’s digital development index analysed 88,000 UK job adverts and found that 20 per cent of jobs advertised in the East of England require advanced digital skills - such as graphic design, data analysis or 3D modelling. However, employees in this region scored 5.27 out of 10 in a digital skills test, second to last in the rankings.

More of region's mid-market companies feature in top 250

Fifteen companies based in the east of England feature in the latest Sunday Times Grant Thornton Top Track 250 league table ranking Britain’s private mid-market growth companies with the biggest sales, up from three last year. The firms increased combined sales 11 per cent to £3.7bn and operating profits 22 per cent to £279m, and employ more than 23,400. New entrants included West Retail Group, based in Barton-upon-Humber in north Linconshire, which consists of Wren Kitchens and Ebuyer.com.  Other newcomers include housebuilder Hopkins Homes based in Woodbridge, and Cambridge-based Ridgeons. Darren Bear, partner at Grant Thornton UK LLP, said: “The UK may be at a pivotal point in its history, but the Top Track 250 clearly demonstrates what can be achieved by exciting dynamic businesses. These companies think locally and act globally, they innovate to grow and embrace an entrepreneurial spirit that this country needs to secure a positive post-Brexit future."

See Profile Grant Thornton

Ipswich-based accountant transfers business

Ipswich-based accountant, Colin Wash (photo,right) one of two partners at Miller Wash Associates, along with his staff and clients, will transfer to Lovewell Blake’s Bury St Edmunds office, based at the town’s Hillside Business Park. He has 25 years’ experience as a partner in top ten national accountancy practices and over the past decade he has specialised in the charities and education sector. Lovewell Blake managing partner Colin Fish (left) said: “Colin is well-known in the county, and this merger cements our commitment to building our business in Suffolk, as well as more widely in the region.”

New group director role created at Norse

Norse Commercial Services has promoted Justin Galiford to a newly-created role of group director of operations for development and strategy. He was previously commercial director and now oversees Norse’s compliance, health and safety, and environmental and quality issues across its operating divisions and public sector partnerships. He has overall board level responsibility for the central procurement team, the safety, health, environment, and quality team and the company’s IT and applications (ITaps) team. Justin Galiford’s new role will include the negotiation and mobilisation of new local authority joint ventures: Norse has 14 such partnerships which are a large part of its £2.2 billion forward order book. Sales director Geoff Tucker said the company is in the final stages of creating a number of new local authority partnerships that will add significantly to its portfolio.

See Profile Norse Commercial Services

Charity bike ride raises £20,000

Property consultancy Bidwells has completed a three-city charity bike ride in which 350 clients, contacts and members of staff took part and raised more than £20,000 for the charity CALM, which is dedicated to preventing male suicide.  Bidwells’ Golden Triangle Cycle Challenge this week started in Oxford, with a midway point in Milton Keynes and finished in Cambridge, where there was an afterparty at Ansty Hall. Riders could cycle the entire Oxford-Cambridge route of 100 miles or Milton Keynes to Cambridge which is 50 miles. Senior partner Patrick McMahon, who took part in the ride, said: “I am delighted that our second Golden Triangle Cycle Challenge was a huge success – thoroughly enjoyed by the 350 participants and raising more than £20,000 for CALM – and hope that it becomes an annual fixture in the property industry calendar.”

Separately,  Bidwells has appointed Verity MacMahon as an associate in its residential development team in Norwich with a remit to act for landowners to bring sites forward to disposal stage and source new sites for development. She has wide experience and has worked with major plcs and most recently Hopkins Homes, where she was senior land manager.

Suffolk firm donates converted container to BBC Children in Need event

Suffolk-based Portable Space recently donated five 20ft converted shipping containers to the organisers aid of the BBC Children In Need Appeal. They were transformed into arched entrances to Superhero World which featured at both the North and South CarFest events, which were the idea of Chris Evans of Radio 2. Mark Dolman, commercial director Portable Space, said: “BBC’s Children In Need Appeal is a very worthy cause and we were happy to contribute by donating the converted containers, fabricating the entrances and also transporting and erecting the structures for both festival venues.”

Izzy McGough, assistant show manager at Brand Events which organised CarFest, said: “The Portable Space team was great to work with and always enthusiastic and generous in giving their time, including coming to London for a meeting….” Portable Space provides innovative solutions for secure storage or additional accommodation, including converted shipping containers, steel cabins and modular buildings and in 2016, it was named one of the Future50 most innovative companies in Norfolk and Suffolk.