The Budget must get credit flowing Nichols posted 2011 pre-tax profits up 34pc to £20.1m last Thursday, helped by a 15pc growth in soft drink sales in the UK. Bye says that when he talks to smaller companies in his sector - those with between £5m and £10m in sales - the biggest frustration is finance, or the lack of it. Companies like Nichols have plenty of cash. The irony is that the big manufacturers are sitting on cash because they just don't know how to use it. But the big issue for smaller companies is the availability of credit to fund their day-to-day working capital needs. He recalls one manufacturer that had secured a large order from overseas but had to turn down the work because its bank would not help to finance the cash flow. "She needed working capital to order the goods but she is having to turn the order away because she can't get the finance," he said. She was tearing her hair out. She is turning away growth and the ability to take on one or two more people. There are thousands of businesses like this and if they each just took on one or two more people it would have a big effect. It means all eyes will be on the Chancellor's £20bn credit-easing plans - likely to involve using the state's credit rating to lower the cost for banks such as Royal Bank of Scotland and Lloyds to secure funds in the wholesale markets, which could then be passed on to small companies. Lucy Armstrong, chairman of the CBI's SME council, wants to hear more about the promotion of alternative sources of finance to the traditional banks. She had 30 companies based in the North East with sales ranging from £50m to £100m in a room recently discussing the topic and thinks that established companies now want to reconsider the extent of their reliance on traditional banking facilities. Armstrong says many founder-run companies are enthused by the planned Seed Enterprise Investment Scheme. It will offer, for one year only from April, income tax relief on sums of up to £100,000 invested in private companies and no capital gains tax on any subsequent increase in value. Company managers and founding families can take advantage of the scheme as long as they control less than 30pc of the share capital. "It encourages them to put the capital they have got into growing their business, rather than putting it into other tax-efficient vehicles that are not directly related to driving growth and jobs," she said. They [the Treasury] should be shouting about this from the rooftops. The British Chambers of Commerce wants a Budget that will drive growth and encourage firms to invest and create jobs. It thinks this could happen if the Exchequer spends £4.2bn. One flagship measure is a two-year £1bn 100pc capital allowance for medium-sized companies to get them spending the cash piles that Bye acknowledges exist. The BCC also wants to see April's inflation-busting 5.6pc increase in business rates scrapped, the restoration of empty property relief and a doubling of wage subsidies to help companies hire more young people. The Institute of Chartered Accountants in England and Wales backs efforts to stimulate investment. Its recent survey with Grant Thornton found that companies expect capital investment to grow by just 0.9pc over the next 12 months. Almost two-thirds of companies are holding on to cash and another third with no current cash surplus intends to create one this year. It argues for the Treasury to rethink plans to reduce the 100pc first-year Annual Investment Allowance from £100,000 to £25,000, which takes effect this April. Bye says his peers are also keen to avoid any indigestion from too much unexpected meddling on March 21. We do want it flat in terms of 'stop tinkering with everything'. We have enough rules," he says. So the recipe for a successful Coalition Budget 2012? Fizzy and flat: a Chancellor known for suffering from a dry mouth when giving long speeches should welcome that.