More than two thirds of small business owners (67 per cent) are working on plans to deliver growth in the next three months. This represents a rise from this time last year (61 per cent) and in every English region, there is an increase in the proportion of small businesses now working on an action plan for growth.
That’s according to the latest quarterly research from Hitachi Capital’s British Business Barometer which recently indicated a fall in the proportion of small businesses predicting growth for the next three months – and a sharp rise in the percentage of respondents fearful that their business would not survive (up from 5 per cent in April to 10 per cent in July). The context of small businesses entering a challenging economic period has given many the added impetus to try to take control of their own fortunes.
The new Hitachi poll asked 1,201 small businesses decision makers what if anything they were planning to do to achieve growth over the next three months.
For many, getting their ventures in good financial shape was the top priority for the months ahead. With a weak pound and the first of what is expected to be a series of interest rate rises, many small business owners are focusing on cutting costs, improving cash flow and getting better finance deals:
• Keeping fixed costs down (37 per cent)
• Improving cash flow (20 per cent)
• Being stricter on getting paid on time (16 per cent)
• Reassessing financial commitments (10 per cent)
• Find new funding solutions (7 per cent)
Beyond financial matters, the three main strategies that small businesses were looking at involved hiring staff, expanding into new geographical markets and investing in equipment and infrastructure to power this. In fact, those businesses most likely to predict significant expansion over-indexed in all of these three areas.
Gavin Wraith-Carter, Managing Director at Hitachi Capital Business Finance, says: “There is no question, the economy is going through a challenging phase and this will impact consumers and the business community at large. What is so encouraging from our new study is that the small business community is not sitting back and waiting for a Brexit outcome to be known. They have told us they have concerns, but they are acting on them. Across the UK there has been a notable rise in the proportion of small business owners that have adopted strategies to help them seize opportunities and try to secure growth at a time of uncertainty.”
“Access to finance is becoming a bigger issue, along with late payment and cutting costs. The businesses that predict the most significant growth are those that are investing in their businesses – bringing people in, looking at new markets and looking at the equipment they need to power growth. Hitachi Capital Business Finance has a wide range of financial products available to help small businesses get the arrangement and the deal that is right for their business. At a time of uncertainty, small businesses are standing tall – and we stand shoulder to shoulder with them because, after all, they are the engine room of the UK’s post-Brexit economy.”
