The result of the impending European Union (EU) referendum is the biggest uncertainty facing small business owners in the UK, a new survey has shown, with 60 per cent of small firms admitting that a potential exit from the EU would scupper long-term plans to grow the business.
As more startups continue to look towards exporting, distributor CitySprint’s survey, called ‘Collaborate UK 2015′, found that the possibility of a Brexit is causing the most concern amongst the country’s small companies, with 27 per cent of respondents stating it was the major worry going forward.
CitySprint CEO Patrick Gallagher said that uncertainties amongst small businesses will make for a more challenging start to 2016. “EU uncertainty is foremost in the thoughts of small business owners when it comes to making long-term business decisions,” he said.
“I think it’s clear to see that companies would welcome some clarity about our future involvement in the EU and the last thing they will want is a drawn-out process around the referendum.”
Political uncertainty within the UK itself was the biggest worry for 26 per cent of the survey’s respondents, whilst skills shortages and the costs involved in recruitment also figured highly, with 19 per cent and 17 per cent of respondents respectively claiming it to be the biggest cause for concern.
The survey also evaluated the financial positions of respondent small firms when compared with last year, with 53 per cent found to be better off financially than at the end of 2014. Indeed, it found that around 1.45m small businesses are now looking to increase sales by targeting international markets.
Working alongside other businesses appears to be key to small firms’ success. The survey found that 85 per cent of small businesses (around 4.5 million) collaborated with others by sharing skills, knowledge and networks – fuelling growth.
Nearly half the survey’s respondents said that collaboration was essential for increasing sales and attracting new business, whilst 36 per cent reported sharing advice and best practice. Outsourcing to other firms was done by 28 per cent of respondents, whilst 23 per cent shared operating costs with other firms. Perhaps surprisingly, just one in five small businesses said that partnering with other firms would be central to growth plans going into 2016.
Gallagher added: “Respondents who placed the greatest store in the partnerships they formed in the economic downturn report being in better shape financially, less worried about the future and less concerned about competitors. It is therefore disappointing to see that smaller firms appear to have forgotten these lessons. SMEs need to partner with others to help cut their cloth accordingly where needed”.
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