Growing optimism among small firms

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The latest indication that the worst of the recession may be over has come from the 10 small firms that the BBC News Website is following throughout 2009.

From all corners of the UK, and across most sectors of the economy, their new monthly updates have never been so upbeat.

DAVID GROOCOCK, ST MAUR HOTEL OWNER

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'S MAY REVIEW Confidence in the business - 9 out of 10. No change from AprilKey current concern - Bank support for small businesses

"Another good trading month for us, almost on par with May last year, with occupancy rates slightly down by 2% to 89%.

However, advance bookings are still showing a 20% increase on last year. While I would expect this to fall back as the months go on, so far this is not the case.

There is no doubt in my mind that more people will holiday in the UK this year, but like any business you have to market your product to the right cliental.

I think we have pitched our campaign to suit, thus we are reaping the benefits.

The weather has been very good, with only a couple of short spells of showery days, and with the Met Office forecasting a "Barbecue Summer" this really is good for us.

If I have any concerns it is about the future direction of the UK economy.

At the moment it looks as if the economy is performing better than most of us would have expected, with the spectre of deflation becoming less of a danger.

But with a policy of inflating the economy with quantitative easing, the timing of stopping this action will be critical. Because if inflation starts to get a hold, interest rates will have to rise.

If this happens in a recession then we could all be faced with a bigger danger - stagflation."

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CARL BRADLEY, OWNER, FUSION SYSTEMS

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

CARL'S MAY REVIEW Confidence in the business - 8 out of 10. Up from 7/10 in AprilKey current concern - hoping that branching out into new territory doesn't finish me off

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

"May was fine, we brook even on last year. So the poor April was hopefully just a blip.

We have now got an account with Panasonic, so hopefully TV sales will start to kick in, increasing our turnover.

We have also reduced the amount of credit we use by 60% to stop us being so reliant on it, and cutting costs."

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MARK STIMSON, BPL SOLICITORS DIRECTOR

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'S MAY REVIEW Confidence in the business - 7 out of 10. No change from AprilKey current concern - availability of mortgage products

"Our level of new business does seem to have stabilised.

However, we have not seen any anticipated seasonal uplift, which seems to suggest that the whole housing market is still skewed by the hold up of mortgage approvals.

We have been told by a number of lenders that whilst they have a high number of 'gold standard' applications, which tick all the boxes in so far as the lending criteria are concerned, they just don't have the money to lend.

All of this means that, whilst we have been able to stabilise our business and stem the bleeding, any return to growth on the back of increased credit availability is some way off.

We are therefore continuing to concentrate on our marketing activities to try to gain a larger share of the business that does exist."

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JAMES STEWART, JAMES STEWART AND SONS CLOCKS

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' MAY REVIEW Confidence in the business - 9 out of 10. Up from 8/10 in AprilKey current concern - pessimism taking over and creating a climate where an economic recovery is delayed

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

"May was a good month for us and was on a par with the same month last year.

The improving situation with the pound is slightly reducing material costs, and hasn't affected international sales.

The summer months are generally quieter for us, but we feel that sales will remain fairly buoyant over this period.

The feedback from some of our customers is that there are definitely green shoots of recovery out there, and with a bit of luck this should bode well for the second half of the year.

With the turmoil of the European elections and the MP's expenses debacle hopefully behind us, and the economic downturn bottoming out, I would say that things must surely be, or at least soon be, on the up for UK."

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LOUISA SHEPPY, OWNER SHEPPY'S CIDER

Louisa Sheppy runs Sheppy's Cider, a family-owned Somerset cider-maker, with her husband David.

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

LOUISA'S MAY REVIEW Confidence in the business - 8 out of 10. No change from AprilKey current concern - people's continuing spending power

"Although the bank holiday weekends were satisfyingly busy in the shop, production and day-to-day work seemed quite disrupted by the shortened weeks.

So I can't help feeling pleased to have all our spring bank holidays behind us, so we can settle down to normal five day weeks again.

Having a long and reputable trading history as a partnership, we were surprised recently to be declined monthly accounts with two new suppliers.

We established our limited company in December 2007, and it turns out that this short period of trading history makes us look like a rather risky new business.

All this is understandable, but we have been disappointed to realise how little the credit rating companies know about our business; one didn't know what we do or even know our telephone number, but still took an enquiry fee from the client.

No wonder it's hard for new businesses to get off the ground."

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STEVE VALENTINE, GWYNEDD CONFECTIONERS

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.

It is based in Gwynedd in Wales.

The factory has 27 employees.

STEVE'S MAY REVIEW Confidence in the business - 8 out of 10. Up from 6/10 in AprilKey current concern - the number of retail multiples closing

"Sales during May were well up on 2008.

Forward indications are positive and appear very upbeat with regard to sales throughout the summer.

Providing the weather remain reasonable to good, then sales will follow suit.

There is a positive outlook from the majority of our customers."

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HARRY MURRAY, HMS JOINERY

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

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

HARRY'S MAY REVIEW Confidence in the business - 6 out of 10. No change from AprilKey current concern - More support needed from banks and the government to support small firms

"There is a definite improvement in the housing market, and a lot more confidence coming back.

People have come to terms with the recession and accepted it has bottomed out. As a result, those who still have jobs seem to be feeling reasonably comfortable.

One of the stumbling blocks, especially for first time buyers, remains the size of the deposit required to buy a house.

Saying that, I now feel very confident in the future, especially in certain conversations I've had with a lot of the large house builders.

The biggest problem for myself - and a lot of other people in the same position if they'd admit it - is being able to carry on and trying to pay debts off at the same time.

A lot of firms, myself include, haven't made money for over 12 months now.

Thankfully the banks aren't being as aggressive as they have been, although they still hold all the cards."

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LEO WHITE, HYDRANT DESIGN

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

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

LEO'S MAY REVIEW Confidence in the business - 8 out of 10. No change from AprilKey current concern - keeping reliable leads

"May was a month of consolidation for Hydrant.

We have starting a new financial year with plenty of work on at present, but also trying to second guess what the economy may do so we can plan our growth accordingly.

We've noticed that potential clients are taking longer to make decisions about new work at all levels, not just larger public funded projects.

The pressure is certainly on to keep a steady flow of new leads and work coming through the studio.

We've continued to specialise and promote our experience with a leading web content management system that allows us to build websites more cost effectively than many of our competitors.

And we've had several enquiries about outsourcing our services to other agencies who have cut back on staff and now have more work than they can handle.

Whilst it's not what we initially set out to do, it's nice that our location and flexibility means we have the option of a 'plan B' when others don't."

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MIKE GRANT, ISLAND LEISURE

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

MIKE'S MAY REVIEW Confidence in the business - 7 out of 10. No change from AprilKey current concern - maintaining the current level of wok into the autumn

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

"With the current level of new enquiry remaining consistently high this has prompted us to take on a sales executive to handle this side of the business.

After interviewing several candidates were are pleased to have secured the services of Jamie Kirk who is well known and respected within the industry."

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JENNY LEES, OWNER DENTANURSE

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'S MAY REVIEW Confidence in the business - 8 out of 10. No change from AprilKey current concern - too much time wasted on paperwork

"May was a very busy month yet again for Dentanurse, with UK sales and those to Europe continuing to grow.

A few years ago one of the large High Street retailers took the Dentanurse first aid kit for teeth off their shelves in exchange for a cheaper product from abroad. They now have had second thoughts.

I was invited to their HQ for a meeting, and we are waiting to hear that hopefully our all British made kit will be reinstated onto their dental shelves."