In the midst of the sixth consecutive quarter of rising productivity, UK businesses have reason to be optimistic for the year ahead. Business confidence across the UK is up, and a nod must be given to the role of small businesses in driving this growth.
The latest CBI SME Trends Survey has revealed an upbeat outlook as businesses look ahead, with both domestic and export orders expected to grow. Indeed, small businesses are truly the power behind ensuring that UK productivity growth is both sustainable and more evenly felt across our economy.
This optimism is important for the UK economy as a whole, with SMEs (small and medium-sized enterprises) accounting for 99% of all private businesses in the UK, generating three-quarters of new jobs. As SMEs lay down plans for greater investment in training and product innovation, these factors in particular will be the foundation for making the UK a more competitive business destination.
Similarly, the latest Federation of Small Business’ Small Business Index indicated rising productivity and positive business assurance across the UK. However, it has also shown that this optimism is experienced unevenly between regions and sectors.
As the tech and services sectors continue to thrive, other sections of our economy could do with a lift. Here is the challenge that we must face, and I believe small businesses can, with the right support, hold the solution to rebalancing the UK economy.
With a proven track record of job creation, small businesses will be responsible for increasing levels of employment in those pockets of the nation that big business is currently failing to reach. The same dynamism that gets small businesses off the ground should also feed into improving productivity in areas that are currently suffering from a lacklustre economic performance.
The year 2016 will certainly bring further change to businesses across the country with the impact of pensions auto-enrolment, changes to taxes on dividends and the new National Living Wage understandably felt more significantly by smaller businesses. In the search for solutions, businesses of all sizes should take the opportunity to unite behind a common voice and speak out for what’s best for business and what business can do to ensure the whole of the UK is confident about what’s next.
A major route towards rectifying the lag between certain sectors and areas of UK business, will be encouraging and supporting small businesses to expand their international trading activities. For those businesses that don’t have the resources to engage with lengthy due diligence or foreign trade fairs, the International Festival for Business 2016 is a fantastic way to go global without having to leave the UK.
Taking place in Liverpool over three weeks from 13 June 2016, IFB2016 will shine a light on the exciting prospects across the UK for international investors. This is the kind of opportunity that will open new international opportunities for companies of all sizes and sectors, but particularly those looking to explore international activity for the first time, or explore new markets.
International ambition and success is far from the reserve of big or London-centric business, and is certainly not reserved for the services sector. The FSB event Global Trade, Europe and Small Businesses will be specifically focused on examining small business export support, how trade deals should include targeted chapters on small businesses and the inclusion of small firms in the European Commission’s trade policy.
Of course, expanding overseas brings a unique set of challenges. Learning from your peers, forging partnerships, and speaking to those with experience brings invaluable lessons, empowering you and your business to overcome obstacles to breaking into new markets.
The FSB Small Business Index indicated that the dominant barrier for export businesses is the fluctuation of exchange rates. It’s a reality of overseas business that these rates are out of your direct control and yet dictate your commercial success.
However, business owners and their champions need to develop the tools and resources that will help protect businesses from sudden shocks and increase their capacity to seize on passing opportunities.
IFB2016 will do just that, offering a wholly practical experience, established international trade events, advice, structured introductions and business matching, and inspiration learning from business leaders and champions.
It takes self-belief to begin and grow a business and every day small businesses across the UK are converting this belief into concrete results – leading the way on delivering stable employment growth and improved productivity. The low inflation environment in which they are currently operating, which is set to continue according to the Bank of England’s latest interest rate forecasts, will help small businesses continue to deliver tangible benefits to the UK economy.
As we are already witnessing, small businesses will drive forward into 2016, and lead the way towards rebalancing our national economy.