Small Firms 'Confident About 2014'

A Survey Of 250 SME Directors Found One In Five Have No Concerns About 2014

03.01.2014

A survey of 250 directors at small firms across the UK has found positive sentiment about prospects in 2014.

Data collected by data centre and communication specialist company Node4 found that one in five companies have "no concerns" about their business' operations in 2014, instead believing the 12 months ahead will offer "prosperity and success".

Figures from across the economic spectrum have shown the UK's economic recovery is beginning to take hold - something that is benefitting SMEs in a number of industries.

Indeed, the latest manufacturing Purchasing Manager's Index from Markit and the Chartered Institute of Purchasing and Supply showed a score of 57.3. Any figure over 50 indicates a growth in order books.

While this was down slightly on November's figures, it remains one of the strongest scores on record - backed by improved exports to Brazil, China, Ireland, Russia and the US.

But despite this good news, some of the SMEs surveyed by Node4 admitted they will face problems in the new year.

Some 34 per cent of those interviewed agreed that their existing IT infrastructure would be a barrier for growth unless it is improved.

Directors stated that developments in the cloud space, as well as other technological progressions, risked leaving their current equipment obsolete.

"It did come as a surprise to find that IT concerns topped the list as the biggest hurdle that SMEs will face this year.

"To our mind, this underlines the important role that IT will play in helping SMEs prosper in a buoyant economy. IT has gone from being a static cost-centre to a dynamic business enabler that must support the organisation at every stage."

However, the widespread optimism surrounding the UK economy was not shared by all firms surveyed by Node4. A third of SMEs told the data centre provider they have fears about generating enough orders to survive in 2014.

Expert Opinion
With improvements in being seen in the economy, it is unsurprising to see that hopes are high among small businesses for the year ahead. However, it is also unsurprising to see smaller firms keeping their feet on the ground to a certain extent by accepting that there will be challenges to face over the coming months.

"The concerns raised regarding technology in this research are important, particularly considering the legal implications that companies could face by failing to update equipment and develop their infrastructure. Issues which can be affected by this may include the ability to accept payments and general data security.

"Growing pains are part and parcel of growth for SMEs and we would urge them to always ensure they are carefully considering all issues. A key aspect of this is ensuring the right legal support is available to advice on key matters from IT-related data matters to more broader employment law or property issues."
Fergal Dowling, Partner