Small businesses are the bedrock of the UK economy. They employ over 15.7 million people and generated a staggering £1.8 trillion of revenue in 2016. Expert Market are keen to support small businesses in whatever way we can, and so have compiled 5 reasons for SME owners and employees to be positive about 2017.
1. Healthy growth
This one is short but it’s important! The number of small businesses is rising and shows no sign of slowing down. Numbers of both employing and sole trader businesses are growing at a rate of 3% each year, which translates into an increase of 97,000 SMEs since the start of 2015.
2. It’s Not All Bad in the Budget
Businesses and individuals across the country are still dissecting Chancellor Philip Hammond’s Spring Budget. Notably, the tax-free dividend allowance for directors and shareholders has decreased, while business rates have risen. Despite the negative press, this year’s budget is not all doom and gloom for small businesses. The Chancellor announced yesterday that the proposed increase in National Insurance rates for self-employed workers has been scrapped. Self-employed workers will continue to contribute 9% on profits above £8,060 to National Insurance, avoiding the 2% rise that was initially written into the budget. 2.5 million workers, many of these small business owners, would have been affected by this change.
3. Government is Open for Business
The government is committed to helping small businesses in 2017. A new initiative launched in January aims to reassure SMEs that the government is open for business (#Open4Biz). Small businesses can seize the chance to bid and win government contracts and become an official government supplier. What used to be a long and lengthy process has now been simplified, meaning SMEs have the opportunity to boost profits and expand their workforce using these contracts. The government has a target that by 2020, £1 in every £3 will be spent with small businesses. Initiatives like the Open for Business campaign are helping to turn this target into a reality.
4. High-spec Tech
Harnessing the power of technology for business is certainly nothing new. But in 2017 the technologies that were once the playtoys of large, multinational firms are becoming cheaper and more accessible for everyone. Virtual reality and augmented reality burst onto the scene in 2016, and experts predict that SMEs can now capitalise on this technology in the coming months. Interior design studios can walk clients through their ideas virtually, while tutors can teach students face-to-face from thousands of miles away. Equally, chatbots are set to revolutionise the customer service sector. The automated bots are proven to drastically reduce wait times for customers seeking help, and the best news is that the technology is getting cheaper every day.
5. Reducing Risky Business
Latest results from the Zurich SME Risk Index indicate the SME business risk is at an all-time low. Overall risk has fallen by 18% since October 2012, which is a vote of confidence for SMEs who are concerned about the future. The drop in overall risk is due mainly to an improvement in supply chain issues, a reduction in the number of SMEs who are cutting wages and recruitment, and less concern overall with regulation and compliance issues. However, the Risk Index should still be read with caution. Uncertainty surrounding Brexit means that businesses must not get complacent, and the report indicates that ‘many SMEs are taking positive steps to safeguard [their] future’.