Partner Article

Time to truly recognise the contributions of SMEs

2015 has been a good year for the UK economy. Annual growth is set to reach 2.3% by the end of the year, with renewed optimism about our state financial outlook. However, despite this positivity on a macro level, for some, 2015 hasn’t been a smooth ride.

According to the CBI, confidence levels at UK small and medium-sized businesses are waning, and we know from our own research that 51%* of business owners are concerned about the future. This, coupled with high competition, paints a potentially gloomy picture and highlights the need to offer as much support to small businesses as possible.

Large companies have dominated the news and received the bulk of the coverage throughout 2015, but we must not overlook the massive contribution small businesses have made to our highstreets and economy. They contribute £379bn, accounting for almost half of the UK economy, and provide jobs for 14 million people. In London alone, there was an impressive 36% increase of new SMEs between 2010 and 2015.

If we want to have a healthy economy, our continued support is needed to ensure that small and medium sized businesses can flourish. As 2015 draws to a close, we should reflect and address crucial ways in which we can help create an environment where these critical members of our community can grow.

It should be no surprise that 71%* of SME owners cover multiple job roles, and this constant pull on their time can make it difficult to map out growth plans - especially when it comes to business connections and skills. The need to source the right personnel, train them and find new business leads for growth is vital - all while keeping operating costs down. One way to make a difference is through collaboration. Knowledge and skills sharing initiatives, such as those run by Innovate UK, make it easier to help start-ups address these gaps, and work towards building a more flexible and advanced business network.

Another area in which SMEs need support is finance, both in terms of accessing it in the first place and then getting what they are due from funded sources. A recent report by the British Business Bank found that bank lending to small and medium-sized enterprises has been in decline since the financial crisis, showing that despite the proliferation of start-ups over recent years, it’s very difficult to get the financial support you need. We hope that in 2016 this trend will reverse, with more funding options being made available. It’s good to see more financial institutions recognising the challenges that small businesses face, with cash advances starting to be offered. Initiatives such as this, which are tailored specifically to match the needs of SMEs, are a great idea and hopefully herald a new wave of support that could help reduce the financial pressure SMEs encounter.

We need to make sure that we are making physical space for SMEs, both on our high streets and in our business parks. The Government’s recent announcement about the creation of 26 new or extended Enterprise Zones is encouraging, but it by no means signals an end. We will still need to continue to make sure that SMEs can find affordable space to both launch their businesses and to grow as their footprint expands.

Finally, we hope 2016 will be the year of customer service. Attracting and signing up new customers is only the first step, and in order to ensure that SMEs know that they are important, B2B companies such as us need to go the extra mile. Communication is key throughout the customer life cycle. Large businesses need to be clear in their commitments to service and provide employees with the proper training and support so that they can keep open channels of communication with their SME customers. No matter the nature of the business, problems can arise, and as B2B suppliers, they need to let the customer know what’s wrong as soon as possible. Equally, they need to foster an environment where they can ask for extra help. This will go a long way in reassuring affected customers.

A healthy small business sector is absolutely essential to any strong and prosperous economy, and we hope to see this going from strength to strength in 2016. The fact of the matter is that today’s global corporations are yesterday’s start-ups, so giving our SMEs a helping hand will have sustaining benefits in terms of economic contribution, skills growth and job creation. Now is the time to say thank you to SMEs and get ready for next year’s opportunities, which, with a little help, could be very bright for the UK’s small businesses.

* Opus Energy Business Boost research

This was posted in Bdaily's Members' News section by Lucy Edwards .