A £1 million funding project has failed to entice fledgling businesses to North Staffordshire, it has been revealed.
Stoke-based tyre giant Michelin, which is backing the project, said it was disappointed at the poor response. The firm said that since launching the North Staffordshire business challenge almost a month ago to new start-ups and existing businesses in the region, the take-up had been very slow with only a small number of inquiries and no new loans approved.
Michelin Development, the business development arm of Michelin Tyre, is hoping that situation will change in the coming months with the funding pot proving too good to resist for would-be entrepreneurs.
Michelin Development instigated the project last month after new figures revealed the area was one of the worst performing regions in the UK for new business development and start-ups.
Newly released statistics from Michelin show the North Staffordshire region is the lowest ranking of the four regions – East Lancashire, Dundee and Ballymena – where the Michelin Development fund is available to firms.
Two years ago, 48 per cent of all the jobs created in the area were through investment from the Michelin Development fund.
However, North Staffordshire now finds itself in alarming decline with no new loans or jobs created in 2008. Michelin opted to help fund SME development in the four areas due to its present or historic links with the various communities.
The firm’s UK operation, which is part of a European initiative to support entrepreneurs and a cornerstone of Michelin’s Corporate Social Responsibility Programme, helps expanding businesses through the offer of unsecured loans at Bank of England base rate and the provision of free business advice.
In the three other regions where the funding is available the scheme is flourishing. In East Lancashire, the scheme is on target to create 200 jobs in 2008, while there are also promising results so far in Dundee and Ballymena.
Dave Smith, Michelin Development’s business development manager for North Staffordshire, said: “We issued the challenge last month with a view to invoking a North Staffordshire renaissance, returning to the times when the region accounted for almost half of the jobs created by our fund.
“So far the response we have had has been somewhat muted and we once again issue the rallying call to entrepreneurs in the region to take advantage of what is a great business development opportunity – one we believe is the best out there.”
“It would be a crying shame to see the money we have available not used and with it a great opportunity to inject capital and business growth into the North Staffordshire region,” he added.
Despite the decline in loan applications, companies who took up the challenge in the past are flourishing.
Stoke-based supplier of quality office furniture products, The Office Furniture Place, is one example.
After securing a loan from Michelin Development, the money was invested in new delivery vans resulting in the recruitment of two new delivery drivers and an admin staff member.
In the five years since it was formed, Michelin Development has helped more than 100 new enterprises in industries as varied as engineering, construction, IT and fine china.
Within the next year, Michelin Development is looking to loan a further £1 million, help another 30 companies and create around 250 jobs.