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Business missing 2012 bonanza

March 18, 2008 15:20 IST

Businesses have yet to wake up to the21bn pounds ($42 bn) worth of commercial opportunities offered by the London 2012 Olympics, according to research from Lloyds TSB.

Almost three-quarters of British companies say they have not yet looked into the possibilities surrounding the games.

The bank's report found that small and medium-sized companies were particularly unprepared, with eight out of 10 yet to take any action to evaluate opportunities, compared with 58 per cent of larger businesses.

Even though there are more than four years to go to the 2012 opening ceremony, the bank's experts warned companies should already be taking steps to secure a slice of the economic windfall.

Lloyds TSB, which is a sponsor of the games, will on Monday launch a business guide to help companies capitalise on the Olympic and Paralympic Games.

The bank's economic modelling has estimated the entire commercial benefits of the Olympics at 21 bn pounds. Though the south-east will be the biggest beneficiary, with an economic boost of 8.6 bn pounds, Lloyds TSB says, other regions will benefit.

For example, there could be a 4.4 bn pounds lift to the economy of the north and north-west, 3.2 bn pounds in the Midlands and 1.7 bn pounds in the south-west and Scotland, the bank suggests. While the survey of 800 companies found that those in London were the best prepared, 55 per cent of business in the south-east, 61 per cent in the West Midlands and 77 per cent in the south-west were ill prepared.

Almost half of the respondents said they needed more support and guidance on how to take full advantage of the potential opportunities.

The sectors with the highest levels of optimism for business opportunities were transport and communications, hotel, catering and leisure, and construction.

Truett Tate, group executive director of wholesale and international banking at Lloyds TSB, insisted businesses should "take action now in order to grab a slice of the pie".

"Regardless of industry or location, the London 2012 games provides a golden opportunity for businesses to expand, diversify and reach new audiences," he said.

The research also revealed misconceptions about 2012 contracts. More than a fifth of respondents said it was too early to start looking at opportunities, yet the Olympic Delivery Authority has already let contracts worth more than 1 bn pounds.

One in five said their business was too small to compete, although most of the contracts let have been won by small and medium-sized companies, and a quarter felt they would be shut out because they were not based in London.

Bob Sherwood, London, FT