Despite likely economic headwinds and warnings of stormy weather, , four in five (82%) small and medium-sized enterprises (SMEs) are confident about their business performance going into 2017, either expecting their revenues to grow or remain constant during the next 12 months.
A survey conducted amongst 1,000 SMEs across the UK found that of these, two-fifths (39 per cent) expect their revenues to grow in the coming 12 months.
When questioned on Brexit, a majority of SMEs said they do not expect the decision to leave the EU to negatively impact their business, with two thirds (66 per cent) stating that it will either have a positive impact or no impact on their company.
Interestingly, most SMEs which export to the EU do not expect Brexit to negatively affect their business either, with 56 per cent stating they expect to have either no impact or a positive impact on their company. This highlights businesses’ resilience when it comes to both domestic and international trade, irrespective of the outcome of the EU referendum.
Expectations vary by sector, with almost half (46 per cent) of SMEs in the hospitality and leisure sectors expecting revenues to increase. In contrast, almost a quarter (24 per cent) of legal services firms predict that their revenues will decrease in the next 12 months.
The survey was undertaken by specialist lender and savings bank Aldermore and the results carried in its latest SME Future Attitudes report.
Two-fifths (39 per cent) of businesses expecting to grow in the coming 12 months will do so by launching new products and services, while three in ten (30 per cent) intend to enter new markets. One fifth of SMEs (20 per cent) are planning to expand by enhancing their technology, and a similar number (19 per cent) are doing so by investing additional capital into their business. 16 per cent will recruit new staff to boost production.
Of the 26 per cent of business owners who anticipate a negative impact from Brexit, 64 per cent are concerned about the economic uncertainty caused by the decision and 43 per cent are worried that UK taxes may rise as a consequence.
Carl D’Ammassa, Aldermore’s Group Managing Director, Business Finance, said, “Despite the mixed economic news following the UK’s decision to leave the EU, it is encouraging to see that SMEs remain very much focussed on growth over the coming year.
“Companies are clearly still thinking about new ways to drive their growth and as our research shows entering new markets as well as launching new products and services are high on SMEs’ agendas. This would indicate a continuing confidence in the UK economy over the next 12 months.”