Business rides out the recession

Like everywhere else, business people in Oxfordshire were plagued by uncertainty.

As a result, they battened down the hatches and prepared for the worst. No-one knew what would happen.

Then in the second quarter of the year, there was a collective realisation that the end of the world had not happened.

There was still business to be done, customers to be satisfied and money to be earned. But for many it had to be done in a very different way.

The banks, widely blamed for causing the economic crisis in the first place, would not lend money to support companies.

Cuts had to be made and there have been job losses. But at the same time greater efficiency means companies work more effectively.

The headlines of 2009 have focused on struggling firms and company closures, although the real story of the year has been about how businesses have managed to adapt and innovate their way through recession.

The Mail looked at five different areas to see how Oxfordshire firms coped with the recession.

RETAIL: ON top of the credit crunch, Adrian and Alison Shepherd, traders in Oxford’s Covered Market, had to contend with rising council rents.

Mr Shepherd, who runs the Oxford Engraver, said: “We have been in the market for 22 years. Selling and engraving silver and pewter has worked well with steady trade from the colleges. But I have never seen rent hikes like those imposed recently.”

His reaction to the situation was to diversify.

He said: “We started another shop, Walking Gear, in some of our space. The start of 2009 was worrying but we had to do something or else disappear. It seems to have paid off, but it was worrying.

“The last quarter of the year was poor, with money tight. But our two businesses have done better than we expected, though of course it takes a little time for our new shop to get known.”

Some businesses in the market faced rent hikes of more than 50 per cent.

In North Parade, Oxford, Steve Jebbett, of Town Garden, which has supplied top quality garden tools and equipment for the past eight years, said: “It’s been an up and down year.

“People want good-quality these days and they are willing to pay for it, but they are looking for value for money.

“I saw at the beginning of the year that I had to do something different so I joined up with Pete Slade who introduced a whole new line – fresh, local garden vegetables.

“I am not surprised that analysts say food has done well in the final quarter of the year and non-food less well.

“Garden tools are picking up, but it was a good move, back in February, to make sure we sold both.”

BIOTECH: IT WAS a difficult year for biotech company Summit, which spent the past 12 months struggling for survival.

In 2008, it had a workforce of 100 at Milton Park, near Abingdon, and owned the rights to a promising method of testing new drugs, using zebrafish, at a lab in Reading.

Then, it was confident of raising more money from the stock market. But once the credit crunch hit, its attempt to raise funds did not even get as far as an official announcement.

In June, it sold the zebrafish arm to Evotec, and in September the lab in Reading was sold.

But in a sudden change of fortune, it has just persuaded stockbrokers Singer to underwrite £6m, and it is asking investors for £2.2m to secure its future to December.

It has also secured a £2.2m grant from The Wellcome Trust to develop a drug to treat superbug Clostridium difficile.

Chief executive Steve Lee, right, said: “Our C. difficile programme targets a significant healthcare threat and the two years of funding will act as a potential value driver for the business as the programme is developed.”

The company has also signed deals with drug companies promising milestone payments topping £98m.

TELECOMS: SOME businesses are thriving despite the recession and Witney-based telecommunications firm STL is no exception.

Managing director Brendon Cross has seen annual turnover rise from £3.7m in 2008 to a projected £5m last year, which he puts down to a mixture of hard work and good service.

He said: “There is no doubt a large part of what we do is help people control costs by understanding how they work.

“Also, 18 months ago we had a discussion about working 50 per cent harder to stand still. But what has happened is that people have done that but moved forward.

“Staff work from early in the morning until late at night but are very loyal to us – half of them have been here for 10 years or more.

“We also spend 10 per cent of the time on training.”

PUBS: THE recession has meant landlords have had to face up to customers having less money in their pockets to spend on a night out on top of ongoing problems such as the smoking ban and cut-price drinks competition from the supermarkets.

As a result, scores of pubs across the country are closing every week as people stay at home.

But Trevor Johnson, landlord of The Talbot Inn in Oxford Road, Eynsham, for the past five years, has managed to build his custom steadily thanks to a £500,000 investment from owner Arkell’s, a rolling business plan and a major marketing campaign in 2009.

He said: “We are bucking the trend a little but we have had to be very proactive with our marketing – it is tougher now than it has been.

“You have to offer value for money and good service. Anyone thinking they can come into the trade, do nothing and make a lot of cash is deluded.

“This year could be difficult but it will be better if I see more people getting jobs locally.”

PROPERTY: FOR estate agents, there was nowhere to go but up.

The property market had started to dip in 2007 and by the time the financial crisis hit in late 2008, house sales had almost ground to a halt.

David Blythman, managing director of Headington-based Scott Fraser, said: “We did see a number of estate agents close in Oxford, but the recovery started in mid-February.

“It has been a good year for us. Oxford has been resilient, with lots of public-sector staff such as doctors needing to move.

“We have been lucky. As a relatively new company, we have been able to react quickly and managed to get through without any redundancies.”

He said the company managed to stay profitable in 2008 and, in 2009, kept staff motivated by bonuses rather than cutting pay.

Mr Blythman, right, said the company was helped by the fact that he and his business partner had worked in the industry for decades: “It gives you an insight and for the property market, 1989-90 was a much worse recession.”