UK SMEs remain ambitious amid uncertainty
Three in ten UK-based small and medium-sized enterprises (SMEs) reported growth in the last year despite the turbulent business environment, according to figures from Shawbrook Bank.
The bank’s research, conducted between 9 August and 8 September 2023 by Censuswide, found that despite rising costs, senior decision-makers at SMEs remain ambitious in their plans for the next 12 months.
The respondents were 500 full-time senior financial decision-makers at UK businesses with an annual turnover of less than £501m.
When asked about their business priorities for the next 12 months, 18 per cent said they were concentrating on consolidating their business with a further 17 per cent eyeing up international expansion.
Read more: SMEs more confident to take on finance in September
Recruitment was also highlighted as a key area, with 28 per cent aiming to expand by recruiting new talent and a further 26 per cent focused on upskilling their teams.
Digitalisation also featured high on the priority list, with a fifth (21 per cent) reporting they will be undertaking a digital transformation next year.
Elsewhere, a third (33 per cent) said they were focusing on improving productivity and more than a third (35 per cent) wanted to improve profitability.
Meanwhile, nearly one in five (17 per cent) senior decisionmakers said that prioritising an exit strategy was a top concern.
SMEs with larger turnovers were more inclined to emphasise this goal, as almost a quarter (22 per cent) of respondents from businesses with turnovers between £100m and £500m considered it a top priority.
In contrast, among respondents from businesses with lower turnovers, only 12 per cent shared the same priority.
Read more: SMEs worried about access to finance ahead of General Election
A similar trend emerged among SMEs planning to expand through acquisitions. Among those with turnovers in the £100m to £500m range, more than a quarter (26 per cent) marked this as a key objective.
Conversely, only 6 per cent of SMEs with turnovers below the £1m threshold had this objective in mind.
“It’s reassuring to learn that not only are businesses surviving in the challenging environment but that a decent proportion are thriving and reporting growth,” Shawbrook head of enterprise Neil Rudge said. “It demonstrates just how resilient SMEs in the UK are.
“Clearly future goals vary depending on where a business is in its journey, its size and its geography. However, whether it’s hiring new employees, expanding internationally, or succession planning, in order to succeed most SMEs will need some kind of funding. With mainstream finance retrenching from complex and often-pressing needs, it’s more crucial than ever for specialist lenders to step up and support our economy.”
Read more: Smaller firms taking out more finance after decline in 2022