Confidence dips as businesses think of efficient growth initiatives

EAST African business confidence has dipped 21 Index points to 130 since September 2011, according to the global Regus Business Confidence Index report. However, companies reporting revenue growth increased to 76 percent compared to 63 percent six months ago, although there is a minor squeeze on those reporting profit increases, down to 59 percent from 61 percent. Mindful of the need to contain costs in the quest for sustainable growth businesses identify increasing use of pay-as-you-go business services, more flexible workspace and increasing cloud IT applications as the most effective cost cutting measures for the coming months. Looking back, East African firms identify paying for unnecessary office space (76 percent) as the main reason for corporate distress during the downturn, followed by making permanent staff redundant 48 percent. The report has identified that, respondents identified increasing use of pay-as-you-go business services at 66 percent, more flexible workspace at 52 percent and increasing cloud IT applications at 48 percent as the areas where companies could best make savings without damaging growth prospects. East African firms report that more flexible working conditions for staff (40 percent) and a wider distribution of customers (40 percent) would make the greatest contribution to enhancing future business stability as a platform for growth. Globally, the Business Confidence Index rating is lower for small businesses than for large firms.

Joanne Bushell, Regional Vice-president comments that, “East African business confidence has now suffered a dip possibly probably affected by the Eurozone crisis and a slight slowdown in BRIC growth economies. Although, the proportion of companies reporting revenue growth increased in the past six months there is a small squeeze in those reporting profits. However, in order to grasp growth opportunities in a sustainable way, businesses globally are still looking to cut overheads without damaging their growth prospects. In particular, respondents identify reducing unnecessary office space as an area where businesses may focus their cost-cutting efforts successfully. Respondents further confirm their outlook on flexible working practices declaring that greater flexibility for staff can improve business stability as a platform for future growth. With solutions readily available on the market for flexible workspace arrangements there is no doubt that the number of businesses benefiting from more nimble and scalable arrangements will increase in the coming years. Regus is the world’s largest provider of workplace solutions, with products and services ranging from fully equipped offices to professional meeting rooms, business lounges and the world’s largest network of video communication studios. Regus enables people to work their way, whether it’s from home, on the road or from an office. Customers such as Google, Glaxo Smith Kline, and Nokia join hundreds of thousands of growing small and medium businesses that benefit from outsourcing their office and workplace needs to Regus, allowing them to focus on their core activities. Over 1 million customers a day benefit from Regus facilities spread across a global footprint of 1,200 locations in 550 cities and 95 countries, which allow individuals and companies to work wherever, however and whenever they want to. Regus was founded in Brussels, Belgium in 1989, is headquartered in Luxembourg and listed on the London Stock Exchange.