Survival for privately held businesses could become a global lottery at the hands of lenders suggests new research

New research comparing the expectations of privately held businesses (PHBs) about access to finance in 2009, against how supportive they feel their lenders are being in the current climate, suggests PHBs could be facing a global lottery for survival or failure at the hands of their lenders.

Whilst 61% of PHBs globally expect finance to be less or much less accessible in 2009, a surprising 69% of them feel their lender is currently being supportive or very supportive towards their business - even in such difficult times. The chart shows the global disparities between expectations for access to finance and lender support. Four scenarios emerge, painting a worrying picture for PHBs in some economies.

PHBs in countries like Australia, India and Poland appear most confident, believing their lenders are currently more supportive and their access to finance better than the global averages. PHBs in some of the most mature economies such as the United States, United Kingdom, Japan and New Zealand feel they have the support of their lenders but are significantly less confident about the likelihood of those lenders actually providing finance. The worst off appear to be in Belgium, Thailand, France and Argentina where PHBs not only fear that finance will be less accessible than the global average, but also feel they have the least supportive lenders in the world. It is no coincidence that PHBs in these four countries also scored amongst the most pessimistic in the world in the same survey.

Alex MacBeath, global leader of privately held business services, explains, "These results give a fascinating insight into how lenders are viewed by PHBs in different parts of the world at this time of global financial crisis. Those perceptions of course reflect the different economic, political and cultural characteristics of each domestic market but also, I believe, of the differing quality of lenders' customer relationship management and the confidence of the lenders themselves in the prospects for their own domestic economy.
 
"With a few exceptions it is PHBs in economies that are relative newcomers to globalisation who feel their lenders are being unsupportive, probably because those lenders lack experience of cross-border recessions. The question is whether the PHBs who do feel their lenders are currently supporting them will persuade those lenders to actually deliver the cash when it is needed."

The Grant Thornton International Business Report is an annual survey of the views of senior executives in privately held businesses all over the world. Launched in 1992 in nine European countries the report now surveys over 7,200 PHBs in 36 economies providing territory, regional and global trend data on the economic and commercial issues affecting a sector often described as the 'engine' of the world's economy. Data for eight key industry sectors will be available for the first time in 2009. The research is conducted by Experian Business Strategies Ltd. Grant Thornton International donates US$5 to UNICEF for every completed IBR questionnaire, a donation of over US$39,000 in 2008.

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Christine Hobart
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Neil Bird
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