SMBs hopeful about challenges but must be
tech-focused to achieve goals
It’s no exaggeration to say that most SMBs in the UK have faced significant challenges during the past few years. In May last year, the Federation of Small Businesses called on the Prime Minister for more support to deal with a proverbial ‘ticking timebomb’ fueled by rising costs. One newspaper even ran the alarming headline; “Almost 500,000 UK small businesses at risk of going bust within weeks”.
Figures published in May of this year showed inflation still sitting at 8.7% despite predictions it would fall, while at the same time, the Bank of England has increased interest rates 12 times to 4.5% in its attempts to slow down price rises. Nevertheless, despite the financial setbacks, a global study commissioned by Sage, titled ‘Small Business, Big Opportunity‘ has revealed that SMBs are displaying an increased sense of optimism, as 40% of UK SMBs expect to feel ‘very confident’ concerning the success of their business by the end of 2023.
Along with the UK, approximately 12,000 SMB leaders in nine countries were surveyed, including Canada, France, Germany, Ireland, Portugal, South Africa, Spain and the United States. The study revealed that SMBs worldwide consider the difficulties of 2022 as short-term setbacks and are eagerly anticipating future opportunities. In the UK, SMBs are incredibly confident about their business success. This confidence can be credited to tactical investment in technology, equipment, and staffing, allowing many businesses to streamline their operations, save time, and drive down costs.
Investment in technology – Critical to business confidence
SMB’s confidence about the upcoming year has been driven by increased productivity and adaptation to change. Interestingly, the percentage of SMBs content with their current productivity levels increased from 68% in 2022 to 78% in 2023. SMBs cited efficiency or productivity increases as the primary driver of business confidence.
Adoption and ongoing investment in new technologies will be vital to SMBs bouncing back. Globally, businesses that invested in new equipment in 2022 benefitted from a productivity increase of 114%. Conversely, according to the study findings, only 13% of UK SMBs anticipate increasing their tech investment compared to the European average of 18%. There is an unequivocal need for support for UK SMBs to ensure they adopt technology correctly so they don’t fall behind their European counterparts.
New technology delivers new opportunities. For example, businesses that harness advanced technology can automate processes to increase information visibility and enhance decision-making. Technology is empowering people to change the way they work, not only within the company but across the entire network of customers, suppliers, and employees, creating a new epoch of intuitive business.
Research sources: SME Business News, The Guardian, Sage.com