February 07, 2014
Lack of time – not money – is now the number one worry for small firms as the UK economy starts to recover and businesses look to grow.
This is one of the key findings of a new survey of SME owners by the Forum for Private Business (FPB).
The majority of SMEs (85%) have told the FPB that they are positive about the year ahead and plan to grow in the next 12 months. But the survey has found that time, money and expertise are all seen as barriers to growth, especially for those businesses that have downsized during the recession.
However, where finance was the biggest concern for SMEs during previous years, those firms that see the cost of finance as a barrier to growth has fallen from 36% to 24%. Now time is seen as the biggest problem, with 36% of small businesses reporting that it will continue to be a major challenge as they look to realise their growth plans. Cash remains an ongoing concern for 26% of respondents and 13% believe they lack the necessary expertise.
Alexander Jackman, FPB head of policy, said, "That time is now the biggest barrier for businesses growth potential in 2014 sends a clear message to government. Now is the time to build on the success of deregulation measures introduced and to really push on minimising the impact of some of the big employment law reforms currently in progress. A focus on creating stability of regulation for small businesses would be enormously helpful."
Thanks to high levels of business confidence, 30% of business owners expect to increase the size of their workforce and 15% expect to increase their hours. Development of customer bases was cited as the most popular growth strategy with 60% looking to target new customers. In addition, 42% will focus on improving customer service and 41% plan new product development.
Despite the positive outlook, however, the research shows that the overall "cost of doing business" remains a real concern for small firms, with 46% seeing business rates as a continuing burden, followed by the rising cost of utilities at 40%.