Scottish companies generate £1 billion increase in turnover last year

22nd September 2013

Scottish companies that work intensively with Scottish Enterprise (SE) through its account management approach have generated combined turnover growth of £1 billion in the last year.

These companies have increased their cumulative turnover by 8% between April 2012 and March 2013, growing from £12.7 billion to £13.7 billion during the period.

As a result of this growth these companies have generated a total of 2622 new jobs, an increase of 1.3% during the year.

Almost 80% of SE account managed companies submitted their turnover statistics for last year. These submissions demonstrate an average turnover growth of £1.7 million, with 70% of companies actively growing. Companies in the oil and gas, food and drink and technology sectors have contributed the highest levels of turnover growth.

Lena Wilson, chief executive of Scottish Enterprise, said, “We work intensively with these companies because doing so generates the greatest economic impact for Scotland. They have the ambition and capacity to grow, a global mindset and strong leadership teams inspiring their work force.

“We’ve listened to our customers and responded to their needs by tailoring our account management support to where it can be most effective. This flexible approach allows us to work with even more ambitious growing companies who are investing and creating jobs.

Enterprise Minister Fergus Ewing, who is leading a Parliamentary Debate on enterprise networks on 11 September 2013, said, “Scottish Enterprise’s latest figures demonstrate further progress on Scotland’s economy. Key industries such as oil and gas, food and drink and technology are continuing to perform well and it is promising to see more than 2000 jobs created by the companies working directly with Scottish Enterprise.

“The challenging global economic conditions, particularly in the Eurozone, continues to make it a testing time for Scottish businesses, which is why the Scottish Government is working closely with Scottish Enterprise, Highlands and Islands Enterprise and Scottish Development International to support companies to expand and reach out to new and emerging markets.

“This Government is working tirelessly to secure jobs and investment, and to retain Scotland’s position as the best place to do business.”

[Please see Notes to Editors for company case studies, including company quotes, which illustrate how companies are growing with SE support]

The £1 billion in turnover growth news comes on the same day that SE publishes independent evaluation of its account management approach.

The evaluation examines the impact of SE’s account management approach on Scottish companies between 2008/09 and 2011/12.

It found that this approach to supporting business growth is very successful in generating increases in company turnover and employment and provides value for money, with 80% of companies saying their turnover has grown with SE support, and a further 5% of companies stating that their turnover has grown faster than it would otherwise.

The report also identified that for every pound spent on account management support to a company, it generates £5.30 for the Scottish economy.

Over the four year period of the evaluation, SE’s account managed companies delivered:

an additional £575 million gross value add to the Scottish economy
this additional value to the economy rises to £1.1 billion when employee spending and benefits to companies’ supply chains are included
an estimated additional 15,130 jobs created by account managed companies and their supply chains by working with SE
The evaluation report also explored the various ways in which SE assists companies to achieve their growth plans, and found that:

80% of companies state that SE has influenced their company strategy development.
half of companies say SE has helped them enter a new international market
40% state that they’ve increased sales in existing overseas markets with SE assistance
three quarters of companies report that they’re spending more on innovation because of SE support
70% of businesses say that their productivity has improved with SE help
companies report that SE support has been critical in helping them mitigate the recession
Dr Wilson continued, “Our companies tell us that our account management approach is helping them to grow and expand, so it’s no surprise that an independent evaluation found that 90% of the companies we work most closely with value our support.

“This evaluation shows that our support translates directly into increased levels of turnover, international sales, innovation, productivity and employment.

“These businesses are crucial to Scotland's future economic growth and we will encourage them to be even more ambitious and more demanding of the support they receive from us.

“I’m extremely proud of the work that our account managers and account teams are delivering to support Scotland's high growth companies. We intend to about build on our success to date and deliver even more impact from our efforts.”