Last month, amid pressure to get the country lending and spending, the Bank of England cut interest rates to 2%, equal to the lowest ever. But with many printers locked in credit agreements, will they see any benefit?
MAYBE: As a company with very low gearing and cash in the bank, falling interest rates are of no benefit at all. We are, however, actively pursuing acquisition of suitable Northwest-based companies and when the right opportunity presents itself, low rates of interest will make the decision much easier. This, of course, is reliant on the banks passing on the cuts and making finance available to the companies that will benefit most and become stronger through what is undoubtedly the toughest trading period in recent memory.
Brian Hough, managing director, Printoff Graphic Arts
MAYBE: We are in a privileged position to not have any significant debt on our balance sheet, so we haven’t directly benefited or suffered from the higher cost of borrowing and the reduction in interest rates. But we will be affected if our suppliers start restricting normal credit arrangements as this could have a significant impact on our cashflow. At a minimum we’re hoping that our employees with mortgages will benefit from a rate cut, during what will be a difficult time for many families.
Hannah Senior, sales and marketing director, Duraweld
MAYBE: Like consumers with mortgages linked to the base rate, we will benefit from reduced interest repayments. But this benefit has been immediately eroded by dramatic increases with energy and raw material costs, especially since the slide in the pound’s value against the euro. The maelstrom in the finance markets and plummeting consumer confidence is impacting our customers’ businesses and affecting strategies and budgets. Continuing to communicate closely with existing customers is the best way of staying ahead.
Andy Ruddle, sales and marketing director, Real Digital International
MAYBE: From a sales point of view, the market is tough at the moment and people are cutting their print spends. They are already buying cautiously and so any difference the interest rate cuts will make will appear slowly. The cut will help more people than it will hinder. In terms of printing kit, the reductions have created some attractive rates, the problem is raising the finance as banks are not lending. Some people are also locked into fixed rates so they won’t benefit from these changes.
Patrick Headley, sales director, GI Direct