Brexit uncertainty poses the biggest challenge for UK's SMEs in 2019
14 January 2019
- Almost a third (30 per cent) of SMEs are worried about the impact Brexit will have upon the economy
- However, a fifth (20 per cent) remain ambitious for growth in the coming year.
Ahead of this week’s vote on the Government’s proposed Brexit deal, research commissioned by The Co-operative Bank highlights that the impact on the economy of the UK’s exit from the European Union is the biggest challenge on the minds of small and medium sized businesses for the year ahead.
The research, which asked SMEs to consider their outlook for 2019 based upon a range of business issues, revealed that three out of 10 (30 per cent) cite economic uncertainty following the potential outcome of the vote as one of their main concerns, with increasing operating (19 per cent) and supplier costs (14 per cent) also highlighted as worries for the next year. A fifth (17 per cent) will be watching the behaviour of their peers closely to ensure they are able to maintain a competitive position.
10 biggest concerns for 2019
Per cent of SMEs
Impact of Brexit upon the economy
30 per cent
Increase in operating costs
19 per cent
17 per cent
14 per cent
Increasing supplier costs
14 per cent
How to take my business to the next stage in its journey
13 per cent
Changing customer behaviour
13 per cent
13 per cent
Access to funding
11 per cent
10 per cent
Despite the challenges they face, SMEs remain optimistic about the opportunities available to them over the coming months – with a fifth (20 per cent) looking to acquire more customers during 2019. One in five (20 per cent) are exploring the development of new products and services, while 14 per cent are considering the role of networks and partnerships in helping to grow their businesses. One in ten (10 per cent) SMEs plan to focus on training and developing their employees to ensure they are in the best position possible to face the year ahead.
Ryan Etchells, Head of Business Banking at The Co-operative Bank commented: “At the start of a New Year many of us pause to reflect on the challenges and opportunities which are likely to emerge over the coming months. While the economic and political outlook remains uncertain it is difficult to know exactly what to expect and how to plan for the impact of many of the scenarios we face. However, the UK’s SMEs are hugely resilient, and willing to adapt in order to succeed; indeed, while Brexit remains the foremost challenge on their minds – there are some that also recognise this may also create opportunities for them.**
“While they cannot control the world around them, by remaining focused and committed to fulfilling their customers’ needs, SMEs can still look at opportunities to grow during 2019.”
SMEs have also called for the Government’s support in making changes that would support how they operate. A quarter (26 per cent) would like to see tax breaks for small and medium sized businesses introduced, while a fifth (21 per cent) would like to see the level of red tape they face stripped back. One in ten (12 per cent) would also urge the Government to form a clear plan to support local businesses, and in particular address the demise of the high street and the impact of this upon communities.
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Notes to Editors
*Research of 1,007 UK SME decision makers carried out between 16th-30th November
**Seven per cent of SME’s surveyed identified Brexit as an opportunity for their business in 2019.
Emma Beresford, Lansons: +44 (0) 207 566 9714/ 07730 594806
About The Co-operative Bank
The Co-operative Bank plc provides a full range of banking products and services to around four million retail and SME (Small and Medium Sized Enterprises) customers and is committed to values and ethics in line with the principles of the co-operative movement.
The Co-operative Bank is the only high street bank with a customer-led ethical policy which gives customers a say in how their money is used. Launched in 1992, the Policy has been updated on five occasions, with new commitments added in January 2015 to cover how the Bank operates its business, products and services, workplace and culture, relationships with suppliers and other stakeholders and campaigning.