The North East was always known for heavy industry such as mining, steel and shipbuilding. But as these industries began to fade away, it looked as though this part of the world might see a terminal decline
After high unemployment and low investment over the past 20 years, industry in the North east has reinvented itself. The opening of the Nissan factory in the mid-1980’s was the catalyst in many ways to investment returning to the corner of the earth. And this has been followed by national and multinational manufacturers following suit. The North East has taken the skills of the local people and moulded them into car part makers, food producers and digital pioneers. Hot on the heels of the Northern Powerhouse announcements of the government, the North East looks like it is just getting on with it themselves. We have large manufacturers across the North East, but what sometimes is overlooked is the fact that each of these have local companies set up around them as suppliers of parts or distributors of the finished products.
These are the businesses that have seen an opportunity and made the most of what they saw as potential. The North East is thriving Look at any local newspaper and website and you will see a lot written about local businesses. Just a quick look today shows Sausage maker Heck targets high-end market as £3.5 million factory opening creates 75 jobs Big North Sea oil find could be major opportunity for North East firms Inside Teesside Halfords flagship’ store with race track, tech table and coffee while-u-wait. Now you may think that these have very little in common. One is retail, one mining and one food manufacture. Apart from being in the North East, what it the link between these three stories. Well, the element that draws all of these together is investment. But this isn’t just any investment there is a risk involved.
Now you might say that there is risk attached to just about any investment. But with these three stories we are looking at risks that are designed to further their business and attempt to overcome uncertainty. This is a completely new store for Halfords and they have no idea whether it will work for their clients. Heck have gone to bigger premises and with it has launched new products that will have presumably need to have been tested. North Sea oil might be a major draw when it comes to making good money, but can also mean innovative technologies and can also be a major draw on cash reserves. Where does all this investment come from? That’s a really interesting question. Traditionally businesses either had the capital reserves themselves or developed a strong relationship with their bank. But there are so many other options available in the internet age, which include Access to crowdfunding Alternative investment websites Angel investors Non-mainstream commercial lenders So, the days of trooping off to the bank with a solid business plan and saying a small prayer are not completely over, but are not the only option. And the smart company has cottoned on to the fact that there is help from the government for investments like these where the business improves their processes or develops a new product or technology. So, what is this government help? This is simply known as R&D tax credits. They have been funded to the tune of billions as the UK government wants us to up our productivity and get better at what we do. Businesses that participate in research and development are eligible to make a claim.
There have been over 150,000 of these claims since the scheme was set up. Small businesses don’t always know that this scheme is available and if they do, they don’t always think that it applies to them. This means that they can miss out on the potential of claims that range from a few thousand pounds to hundreds of thousands of pounds. Although R&D tax credits can only be claimed at the end of the company’s financial year, the progressive North East businesses are making it a part of their ongoing business plan. Once they understand the way it works and what it can do for their business after an initial claim, they have the confidence to build it into their ongoing business. The past two tax years can also be claimed, so don’t think that you have missed out on expenditure in this area that has happened in the past.
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