Quarter of SMEs looking to grow in 2016

Tuesday 15 December 2015

A new report has found that a significant number of small businesses are hoping to grow over the next 12 months.

According to the analysis conducted by Close Brothers Asset Finance, around 1.35 million small and medium-sized enterprises (SMEs) in the UK are planning to expand their company at some point in 2016.

This means that one in four small businesses feel as though the climate is positive enough for them to look towards expansion in the near future. In addition, more than half (56 per cent) believe that their company will remain stable over the next 12 months, suggesting a high level of security among firms of this size.

In its quarterly survey of SME owners and senior management from a range of sectors, the firm found that a fifth (20 per cent) of SMEs believe their business is prospering in the current economy.

The analysis also found that more than half of the SMEs surveyed believe that the worst of the economic climate is in the past and are confident that it will now steadily recover.

Talking about the results from the survey, chief executive of Close Brothers Asset Finance Mike Randall said it was encouraging to see that a "significant number of business leaders" in SMEs are expecting to grow their brand in the next year. He said it shows a "real belief in the market and the future of their business".

However, it seems that acquiring investment is still a significant hurdle for many small businesses with around one in ten (13 per cent) having missed out on a business opportunity in the last year because of a lack of available finance, the findings reveal.

With this in mind, nearly a third of the companies asked (29 per cent) plan to get funding for their business in the next 12 month, while around a third of these (30 per cent) are looking to secure up to £100,000 to expand their brand.

Mr Randall added: “Our study clearly shows that investment will be key to a lot of companies in 2016, and we know from our experience in the market that many of these will be using the funding to grow their businesses."

He said that this made it vital that businesses understand their finances to ensure they don't miss out on any opportunities, as well as allowing them to successfully manage the future needs of the company.

By Victoria McDonnell

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