SMEs Games legacy ‘may be slow-burner’
SMALL firms fear any Olympics boost may be counteracted by a post-Games dip in revenues, new research suggests.
A study of 500 small and medium-sized firms by insurance giant Aviva said trading conditions remained tough, with more than one in five firms worried that the positive effects of this year’s events could be short-lived.
In East Anglia, business leaders have mixed feelings about the effects of the 2012 Games, with some believing they will deliver over time and others fearful that they may have a negative impact overall.
David Bruce, commercial product manager at Aviva, said: “Based on this latest data, SME owners are hanging on in there. Trading conditions clearly remain tough, while it seems many owners are perhaps being more pragmatic than optimistic in their forecasting of future revenues.
Paul Winter, chair of the Suffolk branch of the Institute of Directors, warned that the Games cannot be expected to provide a solution to the UK’s much larger economic woes.
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“The increase in revenue from tourism has been counteracted by the lack of normal business activity on the high street, which has meant the Olympics has so far had a negligible net effect on the economy,” he said.
“Businesses shouldn’t expect instantaneous results but gradual and incremental growth.”
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Suffolk Chamber chief executive John Dugmore said it was too early to establish the effects of the Games in Suffolk.
“The reports that central London is very quiet compared to usual is no surprise. It does show that the messaging from tourism and transport groups about steering clear of the capital during the Olympics, has worked,” he said.
Jeanette Thurtle of the Federation of Small Businesses said: “We have yet to see what the overall impact will be on trade. Just how severely small firms are affected, positively or negatively, will also depend on what line of business they are in. Prior to the Games, the FSB’s ‘Voice of Small Business’ Survey Panel showed that 62% of small firms believed that the Games would have no long term positive impact on their business. Only 7% of small businesses believed the Games would benefit their business overall, and a quarter (25%) expected a negative impact on their business.
“The FSB is concerned that the Games were sold on the basis that it would create a long legacy for the country, yet small businesses do not believe that they will benefit from this.”
David Burch of Essex Chambers said: “For many businesses it was difficult to know what to expect from the Olympics.
“Some have had a boost by gaining contracts for different aspects of the games but so much of the emphasis is on what is happening in London that we do not appear to see a boost in foreign visitors into Essex, despite the goood road and rail links, whilst at the same time many UK residents appear to be holidaying abroad.
“As to the future, I think it depends upon what the Government does to boost the economy rather than expecting a spin off from the Olympics”