Most UK SMEs predict double-digit growth in 2015
Small businesses are seeking fresh growth in the UK with two-thirds anticipating double-digit growth in 2015 but are also concerned about having the resources to support it, an EE survey has found.
It’s generally accepted that conditions are getting better and better for small and medium-sized enterprises (SME) in the UK, and since SMEs make up the vast majority of all UK firms, they’re expected to be the engine of economic growth.
A recent study found that although this may be true, SMEs also have concerns about developing the right base from which to expand.
The survey from telecoms company EE finds that businesses are very positive about their prospects for the near future. In fact, of the SMEs surveyed a total of 69 per cent said they were anticipating growth would at least reach double-digits. On average, they predicted expansion of an impressive 26 per cent over the course of 2015. That suggests that they are expecting to enter into a new phase of accelerated growth that will give employment and the economy a further boost.
But even though growth is on the horizon, it seems that SMEs are not sure how they will be able to handle expansion when it arrives. Some 42 per cent said that they feel they are not properly equipped to scale their companies up in order to meet much higher demand. In particular, a lack of appropriate technology and office space are major concerns, but it appears that skills gaps are also holding them back, since finding the right employees was another significant worry. Unless they can address these issues, more than four out of ten say they fear their businesses will be under threat.
“Our research shows Britain’s small businesses are expecting growth in the next year, but many worry they don’t have the resources to scale to meet that change,” explains Mike Tomlinson, EE director of small business.
The EE survey doesn’t specify whether businesses are expecting growth to come from domestic or foreign sources, but there’s plenty of space for exports to take them into their next stages of growth. Recently, a DHL Express study reported that half the SMEs surveyed have seen international growth opportunities and they are clearly positive about the potential – over the five years to 2019, most expect to get into a position where half or more of their total revenue overall comes from overseas.
However, they did have some issues to deal with first. The quality of the infrastructure available to support their growth was again the biggest concern, although the study focused less on internal capabilities and more on the practical issues of getting businesses going and bringing products to market successfully. Cultural barriers and the cost of doing business were also cited as factors.
SMEs are very clearly ready and willing to grow. But where practical issues such as the resources and infrastructure available to them are obstacles, it’s important to remove those barriers and make sure they have everything they need.
The Sage Business Index recently found that SMEs in the UK are more confident they have been at any point in the past four years – with the right tools and support, there’s a very bright future ahead.