In a climate of increasing optimism, nearly 70% of UK small and medium-sized enterprises (SMEs) are confident about their future, marking a rise from previous years.
The annual Barometer survey, conducted in collaboration with Small Business Saturday UK, revealed that confidence among SMEs has surged, with 69% of business leaders expressing confidence in 2024, up from 67% in 2023 and 65% in 2022. This survey included responses from 1,000 SME decision-makers and sole traders, illustrating the growing sentiment of optimism.
A significant boost in sentiment was noted among micro enterprises (1-9 employees), where confidence rose to 67% in 2024 from 62% last year. Additionally, 71% of SMEs feel their businesses are in good shape, marking a 5-point increase since 2022. This heightened confidence is fostering growth-focused strategies.
A substantial 52% of SMEs plan to invest more in their businesses over the next year, prioritising improvements in customer engagement. Key strategies include enhancing communication with customers (54%), offering additional services (42%), and introducing more special offers (33%). Notably, the importance of price as a purchasing decision factor has declined, with only 51% of respondents citing it as the main factor, down from 57% in 2023.
Meanwhile, 57% of businesses anticipate stronger sales in the fourth quarter of 2024 compared to the same period in previous years. Amanda Salt, Vice President of Small & Medium Enterprises, remarked, “It’s incredibly positive that more SME businesses are feeling confident about the future. While it remains a challenging landscape, business owners continue to show remarkable resilience as they focus on growth and delivering for their customers.” Michelle Ovens, Director of Small Business Saturday UK, echoed these sentiments, underscoring the crucial role of small businesses in driving local communities and the broader UK economy forward.
Artificial Intelligence (AI) is poised to play a pivotal role in SME growth. Almost half (45%) of respondents intend to adopt AI solutions over the next year, with medium-sized businesses leading the charge at 64%. AI applications are varied, encompassing marketing (49%), content development (49%), customer service (36%), and accounting process efficiency (34%).
With strong indicators of growth and a burgeoning interest in AI, UK SMEs are positioning themselves to thrive despite the challenging market conditions.
UK SMEs are exhibiting strong resilience and forward-thinking strategies by focusing on customer engagement and AI adoption, signalling a robust outlook for the future.
