A new survey of UK small business owners has found that many are optimistic about their prospects in the short-term, with six in ten expecting their turnover to grow in the next three months.
A new survey of 1,000 small business owners in the UK, conducted by OnePoll for Uswitch, has found that many are looking ahead with confidence and seeking funding to make their growth plans a reality.
The findings show that 60% of small business owners have confidence that their business will grow in the next three months; only 14% expect a decline in turnover. When asked about growth expectations in the next three months:
- 19% of business owners said they expect to see significant growth;
- 41% expect moderate growth;
- 27% expect no change;
- 11% expect a moderate decline;
- 3% predict a significant decline.
However, the research highlights a significant disparity in confidence between age groups - while 84% of young entrepreneurs (aged 18 to 34) expect to see business growth, only 30% of entrepreneurs aged over 55 expect the same. Older business owners are more pessimistic, it seems, with 25% of over-55s expecting their firm to decline in the coming months, compared to just 5% of younger entrepreneurs.
When it comes to reasons for caution, the over-55s point to some specific issues:
- 53% cite rising operational costs;
- 48% mention government policy or regulatory uncertainty;
- 46% point to inflation and weaker consumer spending.
Small business funding plans
With six in ten firms showing optimism, it’s not surprising that a significant number of SMEs plan to invest and grow; 51% of small business owners say that they are likely to seek external funding in the next three months to support their firm. However, younger entrepreneurs are mainly driving this demand for finance, with 74% of them seeking external funding.
“You can see two very different instincts in the data. On one hand, younger founders are ready to back their plans with finance and scale quickly; on the other, more established owners are tightening their finances and managing costs.” Andy Elder, Uswitch.
Reasons to be cheerful for SMEs
Uswitch reports that while larger businesses have been hit by weaker-than-expected domestic and export sales, the outlook looks rosier for UK small businesses. According to the survey results, increased consumer demand (27%) and improved access to finance (23%) are the main reasons that small business owners are feeling positive right now.
Commenting on the findings, Andy Elder of Uswitch said: “If you run a small business today, the practical takeaway is simple: know where you sit. If demand is returning for you, make a plan to fund and protect growth. If costs are the problem, focus on pricing, efficiency and the areas where you can control spend. Either way, being deliberate about finance, whether you borrow or restructure, is what separates businesses that grow from those that merely survive.”
Written by Rachel Miller.