Four in ten small businesses plan to grow their workforce after promising start to 2022

We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info

A further 58 percent predict an increase in revenue this quarter compared to the same period last year, when the UK was in the third COVID-19 lockdown.

As a result, those planning to hire more staff are looking to recruit an average of six new employees before the end of March.

Data from Barclaycard Payments, which processes £1 in every £3 spent in the UK and services over 350,000 SMEs, supports this trend.

Volumes from the payments firm’s transaction data show SME sales are up 42.3 percent for the last three months of 2021, compared to the same period in 2020.

Overall, there is confidence among small and medium-sized company leaders that they are on track to have a positive finish to the financial year – despite a broader atmosphere of uncertainty among rising inflation, the cost of living on consumers, and the lingering impact of the Omicron variant.

The data comes from the latest quarterly Barclaycard Payments’ SME Barometer, conducted among 577 small and medium-sized business leaders.

Colin O’Flaherty, head of small business at Barclaycard Payments, said: “Small and medium-sized businesses have had a positive start to the year, and it’s encouraging to see so many seeking to add to their workforce.

“SMEs are also remaining resilient by continuing to focus on areas within their control, such as by improving their operating models to overcome the hangover to supply chain disruption which peaked at the end of last year.

“The coming months will no doubt present continued challenges for British SMEs, and the impact of rising costs will remain front of mind.

“Businesses will need to call on the same spirit for innovation and specialised support that has propelled them through the last two years.”

The research found, however, that while 48 percent of SME leaders are optimistic about the outlook for their firms, confidence in the broader economy is less pronounced, with 40 percent reporting a neutral sentiment – outweighing the 24 percent who are optimistic.

Just under two-thirds of SMEs are worried about a rise in the cost of living and inflation, and a similar proportion highlight a feeling of nervousness about increases in their energy bills.

While four in ten feel it will impact their ability to remain competitive, and another tenth will consequently reconsider the need for a physical retail outlet.

As a result of the challenging economic backdrop, SMEs have a mixed view on how this will impact consumer spending throughout the year.

While four in ten expect it to fall, almost a third (29 percent) believe that, although shoppers will spend cautiously, they are likely to spend more on loved ones to help lift their spirits.

Jo Fairley, co-founder of chocolate maker Green & Blacks and SME Investor, said: “The strong start to the year for British small and medium-sized businesses is really great news.

“But it comes at a time where two-thirds of SMEs are also acutely aware of the challenges posed by the rising cost of living, inflation and energy bills – potentially a perfect storm.

“From my own experience running multiple ventures, I know all too well that trying to weather economic turbulence while growing a business can be daunting on top of the day-to-day fire-fighting.

“Nevertheless, the last couple of years have shown that the British consumer is keener than ever before to support smaller and local businesses, and this should prove really positive for SMEs, helping them not just to cope but to grow in the months ahead.”

Source: Read Full Article