Lloyds Banking Group's North West area director for SME banking, Martyn Kendrick
Richard Bell

Interview: Martyn Kendrick of Lloyds Banking Group

Martyn Kendrick is a familiar face here at Bdaily. Given his role with Lloyds Banking Group as its North West area director for SME banking, and our own drive to showcase the region’s SME community (you can read more about our editorial values here), it’s little wonder that we see Martyn’s name popping up regularly.

But as North West correspondent, I wanted to know more about what Martyn’s position entails and what his thoughts are on the North West’s burgeoning array of small- and medium-sized businesses.

“I have been with Lloyds 27 years, man and boy!” Martyn told me. “My role is to lead our SME bank, supporting businesses that turn over between £1m and £25m in the North West, while furthering the bank’s group strategy to help Britain prosper.

“As a UK-focused bank this is vitally important to the group and the wider economy.”

Speaking further, Martyn called SMEs “the real engine house” of the North West’s economy, adding: “Their ongoing success by adding value in any way we can is the absolute priority for me and the 160 colleagues who I work alongside.

“In January we found that business confidence in the North West had increased.”

As with any news topic, the stories I write are not always positive, and its seems to me as though an unending maelstrom of problems beset some SMEs before they can really get themselves off the ground and past the startup phase.

When I asked Martyn what he believes are some of the biggest issues holding back the North West’s SMEs today, he said: “Every six months we survey 1,500 UK companies, predominantly SMEs, for our Business in Britain report, which aims to track opinion on some of the most important issues that they face.

“In January we found that business confidence in the North West had increased to 40%, from 37% six months earlier.”

But despite the region’s growing confidence, just over 33% of the firms in this part of the country pointed to a weaker UK-wide demand as the main challenge to the health of their business in the coming six months. Last July, that figure stood at 28%.

“We saw relatively large decreases in firms’ intentions to export to all global markets.”

Martyn continued: “This was followed by rise in the number of businesses that cited weaker overseas demand as the biggest threat to their business – a rise from eight to 15%.

“We saw relatively large decreases in firms’ intentions to export to all global markets, but particularly Asia Pacific, reflecting the slowdown in the powerhouse Chinese economy.

“In the longer term, the well-publicised Northern Powerhouse could unlock many issues, but the big ones in my view are skill shortages and the need for infrastructure improvements. I believe that a better-connected North can increase workforce mobility so that firms can find the skills they need, ultimately boosting productivity across the region.”

As it’s one of the UK’s biggest banks, what exactly is Lloyds doing to address the obstacles faced by its business customers?

“Skills-wise,” Martyn explained, “Lloyds appreciates that the UK – including the North West – needs to ensure it has the right level of skills, and is adept at using the latest technologies, to keep the country competitive.”

“One of the ways that we are supporting the manufacturing sector and closing the skills gap is by contributing £5m over five years to the Lloyds Bank Advanced Manufacturing Technology Centre, which will support the next generation of UK engineers, training up 1,000 young people.

“I believe that the North still has huge unlocked potential.”

“We also have a commitment to grow our net lending to SMEs by at least £1bn per year in the UK – a commitment we have made until 2017. We want to support our customers across sectors to help them expand and grow with our expertise.”

With conversation inevitably turning again to the Northern Powerhouse, Martyn said he thinks it’s “a great initiative”, adding: “I believe that the North still has huge unlocked potential and this initiative could definitely help, but I understand the frustrations over when it will happen and what it will really look like.

“I remain optimistic, and I would welcome greater clarity about the timescale for the scheme, how it will be funded and what it entails.”

The Northern Powerhouse, he said, presents an opportunity that “needs to be grasped with both hands”.

As I’ve reported recently, the North West is an increasingly prominent business hub not just within the UK, but on a global scale. As a prime example, a recent study from business advisors Deloitte, carried out with information services firm Experian, showed that investment in the region from overseas businesses hit £1.4bn in 2015.

But what about exports - the backbone, surely, of any region’s economic link with the rest of the world? Martyn was upbeat about the state of exporting in the North West, although he admitted that there are still hurdles to overcome.

He said: “The North West has some fantastic businesses which have achieved great export success.

“We’ve spoken about some of the export challenges which exist, but I still think that more of our SMEs should be exploring the opportunities that are available to them overseas, and how best to make the most of them.

“I realise it can be intimidating taking a big step like this, but there is plenty of support out there from organisations like UK Trade & Investment, and Lloyds’ locally based advisers are also on hand to help.”

“Communication is key throughout the whole exporting process.”

It’s important, he went on, for businesses to do their groundwork and research their target markets before diving headlong into exporting.

Martyn continued: “Communication is key throughout the whole exporting process, and we always encourage firms to speak to their local relationship managers who will be able to offer the support needed to succeed when trading overseas. There is no need to go it alone.”

To round off our conversation, I asked Martyn what financial advice he would have for a new business owner.

“Cash is king,” he said, “by which I mean it is essential for smaller businesses in particular to ensure that there is always enough ready cash in the business to fund short-term operations.

“And again, preparing proper plans by seeking out the best advice is key – you can never underestimate the power of a strong support network.”

Martyn concluded: “Finally: listen, learn, don’t be scared to ask, be brave and work hard!”

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