During the past 3 quarters confidence amongst SMEs has taken a spiral downturn, and according to the first SME Growth Tracker in 2018 the feeling of negativity has remained and in fact, climbing.
The UK Country Manager at Amazon, Doug Gurr has commented;
“It’s clear that British SMEs are open for business, and those taking advantage of the opportunities presented by e-commerce can grow at a faster rate.
“The commercial benefits to be found by the adoption of digital technology can be enjoyed by all businesses. In fact, last month we published findings showing that more digital adoption in rural areas could add over £26 billion to the economy’s gross value added, so the more SMEs we can support and help adopt digital, the better for the UK economy.”
The report which is generated once each quarter by Capital Economics and commissioned by Amazon UK and Enterprise Nation evaluates growth prospects, and the views of the UK economy – this was sent out to more than 1,000 SMEs.
The report highlighted that the score for each individual business’s performance has actually increased by 1 point to 6 and for their confidence, up by 6 points to a total of 18, which continues to grow since the referendum took place in June 2016.
The report also found an overall increase in business revenue by 1% and employment levels jumping by 0.3% which suggests an increase of 0.7% in productivity which will jump to 0.9% during the next 12 months.
Founder of Enterprise Nation, Emma Jones MBE shares;
“With business indicators reflecting a rising confidence amongst SMEs, today’s results suggest that businesses are feeling the benefits of digital technology, helping them to connect to a wider customer base.
“As global economic uncertainty continues to pose a threat to stable business conditions, it is essential that SMEs adopt agile and innovative ways of working to stay competitive.”
Research also revealed that business’s emails and websites are a common forum to sell to their customers. This is expected to grow over the next 12 months with the implementation set to grow to 65% from 52% of SMEs. It is believed that selling via social media will also increase as 37% use this as a platform to sell. 23% are using third-party retailing sites to sell and 13% are using their own apps to deliver.
The growth of e-commerce is alike for all regions within the UK, however for those who were surveyed in the North East and West Midlands it was found that their e-commerce was at the highest level of 69%. For businesses who use e-commerce to reach their customers, they are expected to see an increase in revenue of 1.6% over the coming 12 months.
The SME Growth Tracker also uncovered that 73% of SMEs have not yet experienced any delay with business decisions however, 13% admitted that they have postponed hiring new staff while 7% held back their international expansion plans due to Brexit. The biggest fear SMEs have according to the research is the effect of rising supply costs.
Chief Project Economist at Capital Economics, Mark Pragnell concludes;
“Since launching the SME Growth Tracker soon after the EU referendum in 2016, we’ve seen a pattern emerge showing SMEs in the majority of regions which primarily voted to leave the EU, consistently more optimistic than SMEs in regions that voted remain.
“For example, this quarter, both the East and West Midlands – which had the highest share of the electorate vote leave in the Brexit referendum – have reported greater confidence than SMEs in Scotland and London where the majority voted to remain.
“But confidence does not appear to correlate with revenue growth expectations, with London and Scottish SMEs forecasting higher revenue growth than SMEs in the East and West Midlands.”