Downturn spares channel players

Business confidence has fallen to its lowest level since October 2003

Business confidence has fallen to its lowest level since October 2003 and UK economic growth is set to slow down, according to accountancy firm BDO Stoy Hayward, but the channel appears not to be feeling the pinch.

Peter Hemington, partner at BDO Stoy Hayward, said: “The economic news following May’s election has been unpromising. Retail is edging down and the world economy is softening. It is likely that the Chancellor will miss his growth targets of three to 3.5 per cent.”

UK business confidence has partly been affected by the expectation that the government will cut spending in an attempt to reduce its budget deficit, said BDO. The firm also expects the government to put up income tax or national insurance in the next few months, reducing household disposable incomes.

However, Jason Tullah, business development manager at reseller Electronic Business Systems, said he has not seen a decline in business.

“We are one of the biggest Sage partners in the UK, operating in the SME space. We have seen a lot of sales in CRM, and also a lot of investment in hardware and servers. We are not a huge firm – our annual turnover is £2m – so we might not be selling the same quantity as other companies, but we’ve had what we’d class as a good start to the year,” he said.

Stuart Green, strategic director at distributor Centerprise, said: “We are actually ahead of our business plans so far this year.

“This is because we have been prepared to look away from our conventional product range and embrace different ways of doing business.”