Closure of Acorn Enterprise Factory

Local business woman Jennifer Shaw with Enterprise Factory advisor Chris Beckett

On 21 May business tenants of Acorn Enterprise Factory were notified of its closure giving just 4 weeks notice - without any offer of compensation in the form of a relocation package.

The Enterprise Factory facility based in Acorn House, Spotland Road, and set up only 9 months ago, was supposed to nurture and grow new businesses by supporting them through their early stages of development.

The initiative was being funded by the Revitalising inner Rochdale SRB5 and ERDF Priority 1 programmes and at the time of the launch, Jahangir Mohammed, the SRB5 Co-ordinator said: "We are very pleased to be funding this flagship initiative. One of the key aims of the SRB5 programme is to strengthen the local economy, by supporting and encouraging local enterprise. This project will create a thriving centre for enterprise within the heart of Rochdale."

Just 9 months later and some of the fledgling new businesses this facility was supposed to support fear they will go out of business as they have no time to find suitable alternative business premises, and moreover, the cost of reprinting stationary, changing websites and advertising a new address are more than many new starts can afford coming a second time in just nine months.

One of the businesses badly affected by the decision is Jennifer Shaw Events and proprietor Jennifer Shaw has written to Penny Sharp, Head of Regeneration at Rochdale Council to say she is "shocked and appalled" at the decision.

In her letter Ms Shaw says: "When I viewed Acorn House in July 2007, I was led to believe that the project was a long-term project, with funding likely for the next 2-3 years or longer. I was enticed to relocate and grow my business to Acorn Enterprise Factory, which is situated in a regeneration area.

"I (and the other businesses) am now faced with the direct and indirect costs of the decision made by The Rochdale Borough Economic Partnership to cease funding the Acorn Enterprise Factory.

"Office accommodation varies in price, with a basic room on Spotland Bridge costing £210 & VAT per month, plus electricity costs, telephone line, broadband connection, and business rates, with no office or other support provided.

"I prefer to continue trading from Rochdale, rather than relocate to Oldham. Rising fuel costs are a live issue, along with limited access hours and the like. Relocation to Borough Mill is for 6 months, with a further move planned thereafter, which will bring with it added costs."

Ms Shaw explains that promotional items printed with her address at a cost of £1500 will now be obsolete and seeks remuneration by way of a relocation package.

She concludes her letter: "I am concerned about the large amount of money that has been invested in Acorn Enterprise Factory and believe that in making this decision absolutely no consideration has been given to the growing businesses there. I am acutely aware of  political wrangling within the Borough which has resulted in the tenants/businesses being 'hung out to dry'.

"Pursuant to the Freedom of Information Act 2000, I seek disclosure of the minutes of the meetings when the decision to cease funding Acorn Enterprise Factory was made, presumably by The Rochdale Borough Economic Partnership and/or North West Development Agency."

In her reply Penny Sharp says: "The project was very much a pilot to test the viability and need for incubation space, coupled with business support for pre start businesses in Rochdale." This has come as news to Ms Shaw and other tenants who hotly dispute the project was a pilot and insist this was never made clear to them.

Notwithstanding the dispute over whether or not the project was a 'pilot', Ms Sharp admits it has been successful and throws in a surprisingly optimistic statement about the project becoming self sustaining, though how that was supposed to happen in just 9 months she does not explain: "Whilst the pilot project has proved successful in supporting businesses, the SRB 5 and ERDF funding has now come to an end. It was hoped that at the end of the 12 months that the project would either become self sustaining or secure funding from elsewhere."

In response to the request for compensation to help defray relocation costs, Ms Sharp passes the buck: "Whilst we do appreciate that businesses have incurred costs in relation to printing and stationery and relocation, this is always a risk with short term licenses and short term projects, and it is the responsibility of any externally funded project to ensure that their clients are made aware of all risks."

What is clear is that the words of Programme Co-ordinator Jahangir Mohammed at the opening of the centre were at best ill considered and at worst empty rhetoric, given that Ms Sharp now admits there was no funding in place to ensure the project was able to continue beyond the first year: "This is a flagship addition to the wide range of help and support already available to businesses in the Borough. The Acorn Enterprise factory will be a thriving centre of enterprise in the heart of Rochdale."