Independent macroeconomic analysts Capital Economics’ new SME Growth Tracker indicates that the majority of British SMEs are expecting to grow revenue and jobs over the coming year. Those investing in exporting and e-commerce are more confident about their business prospects and anticipate faster growth than their rivals who do not.
The new report was commissioned by Enterprise Nation and Amazon based on a YouGov survey of over 1000 UK SMEs.
Mark Pragnell, Chief Project Economist, Capital Economics, commented: “Most small businesses are saying they expect to grow revenue in the coming twelve months, particularly those in manufacturing, financial services and professionals services.
“Small businesses from Yorkshire and the Humber, the East Midlands and the East of England, through to London and the South East are most positive, while only those in Wales are expecting revenues to decline in the year ahead. Companies who export and use e-commerce say they are expecting faster revenue growth than those who don’t sell online or only sell domestically.”
The Capital Economics survey found that 46% of UK SMEs export and generate 36% of their revenues from exports. Those who do export expect their revenues to grow by +0.8% in the next 12 months by comparison to +0.4% in the previous 12 months.
Those who export are more optimistic and predict revenue growth of +1.8% as against +1.2% among the 54% who don’t. The SMEs that export expect to create +1.1% new jobs as against those who do not who expect to create +0.5% more jobs.
As one would expect, the survey also gauged the SMEs’ opinion on the “Brexit” issue.
Regarding the Capital Economic study, in a statement posted on its website on Amazon summarised some of the key findings: “Looking ahead to post-Brexit Britain, SMEs believe that Government should prioritise negotiating new trade deals with the EU over any other region or country. The rest of Europe, North America, China, India and Asia are also among highest priority areas for future trade negotiations, while the Middle East, Russia, Central and South America, and Africa are less so.”
The Amazon summary added: “43% of SMEs believe that the wider UK economy will deteriorate over the next 12 months, compared to 33% who think it will stay the same, and 24% who expect an improvement.
“77% of SMEs say Brexit has had no impact on business decisions; while 23% report they have put off business decisions due to Brexit, with 12% delaying hiring and 7% delaying additional investment in marketing, and 7% putting off improving business tools.”
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