SMEs need clarification on Midlands Engine before implementing spending plans

West Midland SMEs need clarification from the government on what opportunities lie ahead for the Midlands Engine before they begin to implement their spending plans, a fund manager has said.

Bibby Financial Services said it had increased funding for businesses in Birmingham and the wider region by 39% over the past 12 months.

This is expected to increase once the plans for the development of the Midlands Engine are made clear.

Jim Davis, Bibby’s head of sales for the West Midlands, said: “While there has been much focus on developing the Northern Powerhouse, there is still the Midlands Engine revving along and the region is strongly becoming a viable alternative to London and the South East for many businesses.

“SMEs are eagerly awaiting further details of the Midlands Engine strategy which the Government is expected to release soon. As one of the UK’s busiest cities, Birmingham hosts significant traffic flow and SMEs will welcome details of the Midlands Rail Hub which will provide better transport infrastructure for the region.”

Mr Davis said that in order to take advantage of opportunities arising from inward investment in the area, SMEs needed to ensure they had stable cashflow and working capital to grow.

He said funds would be made available to enable firms in the city region to plan for their growth.

During 2016 BFS’s commercial team in Birmingham structured 158 funding deals, increasing funds available to SMEs from £16.4m in 2015 to £22.9m.

BFS’s Q4 SME Confidence Tracker found that SMEs in the West Midlands are in buoyant mood, with over two fifths (45%) expecting sales to increase in Q1 2017.

Firms are also showing signs of putting their funding to use as 78% of companies stated they intended to invest an average of £111,000 in their businesses during the first quarter of the year.