UK SMEs – small and medium-sized enterprises – are the heart of the nation’s economy. They are responsible for a whopping 99.9% of the business population with 5.7 million micro businesses 5.4 million small businesses (10-49) and 1.9 million medium-sized businesses. The UK’s thriving SMEs are constantly disrupting their industries, finding creative solutions to old problems and opening new markets.
They also play a vital role in supporting the wider economy with many SMEs supplying products or services into larger companies.
Growth of UK SMEs
They are also often more resilient during economic downturns, with their focus on customer service helping them to remain competitive and adapt quickly. Despite these strengths, a number of challenges can affect the growth of UK SMEs, with cash flow management being one of the most common issues. This is why it’s important that SMEs take advantage of the wide range of support available to them, including government-backed initiatives like Enterprise Finance Guarantee scheme and several business grants.
Among the key areas where the UK’s SMEs can improve are in increasing productivity, improving business confidence and reducing the level of bureaucracy. There are some clear recommendations in the report for how to achieve these goals, which include tackling excessive red tape, increasing access to finance and providing better data on the performance of SMEs.
Another way the government can help SMEs to thrive is by encouraging large businesses to work with them on innovation projects through SME engagement schemes. This would enable tax relief to be claimed on both the money flowing into the SME and fees payable to the intermediaries who support process.
It’s also important that SMEs are given the right tools to succeed increasingly digital world. This includes the use of technology for automating repetitive tasks and enhancing efficiency, ensuring that a company is always working at maximum capacity.
The emergence of the modern ‘super-computer’, which is capable of performing complex tasks much more quickly and cheaply than humans means that a huge amount of work can now be automated.
Aa result fewer people are needed in a company to perform they same amount of work meaning profits increased.
Taking all of this into consideration, it’s clear that if the UK wants to maintain its position as a global leader in technology and innovation, then it needs to invest more in its SMEs. In doing so, the country will continue to reap the benefits of a vibrant and innovative business sector.
