UK economy to improve over the coming year, say optimistic entrepreneurs

The Investec Entrepreneur Confidence Index tracks the confidence levels of entrepreneurs. These tycoons (all running businesses with a turnover of at least £1m; of which 78% have a turnover of at least £10m) rate their confidence in both in the UK economy and their own enterprises.

The 2010 Index results are in! 46% of these captains of industry expect the country's economic climate to improve over the next 12 months. Only one in five (22%) have taken more of a glass half empty view, expecting it to deteriorate, with a third (32%) expecting no change in the overall economic outlook.

Within their own businesses, these entrepreneurs are even more buoyant. The Index's findings show that only 4% of Britain's most successful entrepreneurs anticipate that the revenue of their UK business operations will fall during the next 12 months, with nearly one in four (24%) expecting them to increase by over 20%.

With revenues on the up, it's not surprising that 86% of the successful entrepreneurs interviewed expect the profitability of their UK business operations to increase over the next 12 months (26% expect them to rise dramatically), while only 6% anticipate that they will fall.

Cash is looking cosy too: two thirds (66%) of those surveyed also expect their overall cash flow to improve, compared to 63% who said this in November 2010.

Ed Cottrell, head of Investec's growth & acquisition tinance team, says: "The findings from our Index are encouraging, because much of the economic growth we are all hoping for will come from successful entrepreneurs. Many clearly feel optimistic about the future, and our findings reveal that 42% say that it is very likely that they will launch new companies and products in the UK over the next 12 months, compared to 26% who said this in December 2009.

"Given these growth plans, many of these entrepreneurs will hopefully pick up some of the job losses in the public sector. Some 68% of successful entrepreneurs interviewed plan to increase the number of people they employ, while only 6% expect this to fall."

However, there is still a few rogue elements threatening to burst the bubble of optimism among these entrepreneurs, however.

When asked about the main risks facing their businesses over the next 12 months, the biggest was the impact of Government spending cuts - 33% of entrepreneurs interviewed see this as a 'high' risk. This is followed by falling customer demand, where 30% see this as a high risk. One in ten sees the VAT increase as a significant risk.

Are you feeling optimistic about the future? What factors threaten the health of your business? Tell us by leaving a comment below.

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