Helping Asian businesses during tough economic times

Small businesses have faced unprecedented challenges during the first half of 2009. And the Asian business community has been no exception, as the recession has taken its toll across the country.

The implications of this for Asian firms are critical. There are approximately 200,000 Asian owned businesses in the UK, collectively punching above their weight in their contribution to the economy. So it is clear that their survival and prosperity is a key component of the UK’s growth.

But despite the ongoing difficulties, there are plenty of opportunities for strong companies to develop and succeed - and Asian firms are in a unique position. The entrepreneurial spirit, and cultural and family ties shared by Asian businesses, as well as the relative strengths of some of the sectors in which they operate, stand these firms in good stead.

Asians are recognised as the most likely ethnic minority group in the UK to become entrepreneurs. With 38% of graduates coming from the Indian community they see education as a tool to help them increase their power to earn more. However, with many graduates facing tough employment conditions this year it’s looking fairly glum as they leave their universities.

Nevertheless, many Asian graduates are not sitting idle as a number have stepped into helping the family businesses and thus learning new skills and at the same time assisting their parents and/or extended families in providing new creative ideas and ‘fresh blood’ in increasing the outputs from established businesses.

With Asian business communities having strong footholds in a number of sectors including property, IT, healthcare, food and drink, retail and textiles, the graduates are using their knowledge to help diversify their family businesses and therefore the impact of the recession has been limited. Clearly all markets face certain challenges in an economic downturn, but we have seen many operators in these sectors do well. We are able to support these firms and meet their specific needs, with products and services such as our range of Islamic Business Banking services which allow Muslim
businesses to bank according to their principles and faith.

Looking back, upon arriving in the UK, the first generation of Asians faced many glass ceilings which resulted in poor paid jobs and their skills not being valued. This ignited a real desire to “go alone” and resulted in the foundation of the ‘corner shops and the 24/7 working culture’ with many super stores slowly following in their footsteps.

They soon established a solid network in their new country. Starting a business provided an opportunity to engage with the local community and gain financial autonomy and stability. With many Asians having a strong family support network, this provides an excellent foundation for a growing business.

They can call upon these structures to help them be more efficient as well as reducing overheads, as most employees have an invested interest in ensuring the success of the business. Their access to mentors and community leaders is another way to help them gain knowledge and support, by-passing some traditional hurdles faced by SMEs.

This hunger to succeed and survive is a characteristic that many other SMEs could learn from and no firm should underestimate the potential impact of the recession. It’s important that all businesses do everything they can to help guard themselves against the ongoing difficulties and prepare for the upturn when it comes. By seeking the right support and taking the right action now, businesses can not only manage their way through the downturn as it persists, but also gear up to make the most of the recovery as and when it appears.

Lloyds TSB is working closely with firms across the UK to support our customers and to ensure that in every sense they’re well placed to weather these turbulent conditions. We too have learnt from the Asian community resulting in us reviewing our own service offering. I’m proud to say we now understand their specific needs and can cater for businesses according to their principles and faith.

And to help showcase these inspirational entrepreneurs we have sponsored The Lloyds TSB Jewel Awards now for seven years. This is just one of the ways we hope to demonstrate our commitment to the Asian community. The awards comprise three regional heats in the North, Midlands and London. The events in Manchester and Birmingham took place earlier this year with the final in London on 7th November. The awards are famed for the recognition they give to the crème of Asian business talent. By identifying the rising stars in business they not only help raise the company’s profile but are a great way to help the next generation to see role models that inspire and enthuse them to also push their own boundaries.

We also intend to participate in Asset Protection Scheme where we will be committed to increase our lending portfolio by £11bn this year and another £11bn next year – and like other mainstream businesses, we hope Asian businesses will also benefit hugely from this lending commitment.

It doesn’t stop there we are also taking part in a number of other Government schemes such as the Enterprise Finance Guarantee, to provide even more help to firms.

We all need to play our part in helping the UK economy recover and we hope by reaching out and supporting businesses in these ways we too are showing we want to be the trusted advisor for businesses now and in the long term.