Small businesses expect positive year despite ‘incredibly challenging’ 2023
Small businesses are confident in reaching profit targets this year, new research shows, despite high interest rates and an “incredibly challenging” 2023.
A new survey by accountant and business advisory Moore UK shows 80 per cent of small businesses expect to reach their profit targets, with 91 per cent saying their profitability will increase over the next 12 months.
Maureen Penfold, chair of Moore UK, said business owners are beginning to see the “light at the end of the interest rate tunnel.”
While many founders have faced a cash crunch with ongoing funding challenges, nearly half of the 500 UK business directors surveyed said they would be ramping up recruitment efforts.
Recent Chartered Management Institute polls also suggest 33 per cent of SMEs are looking to recruit over the next six months, compared to just 25 per cent of larger organisations.
Penfold said: “While optimism has risen, businesses haven’t lost sight of the challenges they face. They clearly believe profits are going to improve, but that is only going to be achieved through rigorous cash flow management.”
Michelle Ovens, founder of Small Business Britain said she’s cautious of celebrating small business confidence after an “incredibly challenging” 2023.
“It is not what we are hearing from small businesses,” Ovens said.
Some 44 per cent of the businesses surveyed said they plan to utilise AI tools in every day operations, which Ovens believes will be one of the “biggest” opportunities of the year.
“AI is absolutely an opportunity – probably the biggest for small businesses for both productivity and growth as well,” she said.
“They need our support to make the most of these – and ensure confidence does peak in 2024.”