More Than 68% Of SMEs Are Optimistic For The Future

Recent improvements in the UK economy have given small and medium-sized enterprises (SMEs) renewed hope that more profitable times lie ahead.

A new study conducted by Western Union showed that 68 per cent of small firms are optimistic about the future. This is the highest score recorded since the study was first launched in 2010.

Government austerity measures have been scaled back and banks are starting to make it easier for SMEs to gain access to vital credit.

Around 77 per cent of the businesses that took part in the survey felt that more global trade opportunities would open up in the near future, which was a nine per cent increase on figures from the fourth quarter of 2012.

Western Union's International Trade Monitor also showed that half of British SMEs believe the UK's general business environment will improve in the coming months - up from just 37 per cent in the second quarter of 2013.

Companies operating in the manufacturing sector appear to be the most confident at the moment, with 72 per cent expecting to be busier in the future. This compared to just 64 per cent of organisations within the retail industry.

Kerry Agiasotis, chief commercial officer at Western Union Business Solutions, said SMEs are "embracing improved economic conditions". However, he added that firms cannot afford to get carried away by this latest upturn.

"SME sentiment indicates that we are in the midst of a real recovery but its sustainability is still being questioned," he commented.

"The green shoots we are seeing could easily be crushed by a seismic event, such as a renewal of the sovereign debt crisis in Europe. It is too soon to be complacent."

SMEs have been given a helping hand by the government in recent months, which is keen to give start-ups enough impetus to expand.

Whitehall revealed earlier this month that a number of legal reforms that are aimed at reducing the administrative burden on smaller organisations could soon come into effect.

Expert Opinion

This report is further proof of a revival in sentiment amongst small and medium-sized companies. <br/> <br/>“Here at Irwin Mitchell we have welcomed initiatives designed to support SMEs such as reducing unnecessary red-tape, and although we would reiterate calls for businesses not to be complacent, we believe it is important that businesses remain positive and drive forward with their plans to grow. <br/> <br/>“SMEs have revealed that they are extremely resilient during what has been a sustained downturn in the economy. These businesses are the backbone of the UK’s economy and it is vital that they get all the support they need to be successful.” <br/> Fergal Dowling - Partner