Nearly one in five larger SME owners are considering selling their businesses as they prioritise succession planning, while a third have grown in the last year according to research from Shawbrook Bank.
The study found that 17% of SME owners and decision makers view an exit strategy as a top concern. Among SMEs with a turnover of £100m-500m, 22% prioritise selling up, while 12% of those with lower turnovers aim for growth through acquisition.
Despite the headaches caused by rising costs, nearly a third (29%) of SMEs expected their business to grow in the next 12 months, with 29% reporting that their business had grown in the last year despite the turbulent business environment.
When asked about their key business priorities for the next 12 months,18% stated that they were concentrating on consolidating their business with a further 17% eyeing up international expansion.
Recruitment was also highlighted as a key area, with 28% of respondents aiming to expand their teams by recruiting new talent and a further quarter (26%) focused on upskilling their teams, found the Shawbrook Bank SME survey.
Digitalisation was high on the priority list, with a fifth (21%) of those quizzed reporting they will be undertaking a digital transformation next year. Unsurprisingly, SMEs are still very much focused on the big picture as well, with a third (33%) focusing on improving productivity and more than a third (35%) looking to improve profitability.
In a sign that SMEs are not putting off big decisions, nearly one in five (17%) senior decision-makers expressed that prioritising an exit strategy was a top concern.
Notably, SMEs with larger turnovers were more inclined to emphasise this goal with almost a quarter (22%) of respondents from businesses with turnovers between £100m and £500m considered it a top priority. In contrast, among respondents from businesses with lower turnovers, only 12% shared the same priority.
There was a similar trend among SMEs planning to expand through acquisitions, with a quarter of larger SMEs saying this was a key objective. Conversely, only 6% of SMEs with turnovers below the £1m threshold had this objective in mind.
Neil Rudge, Head of Enterprise at Shawbrook Bank, said “It’s reassuring to learn that not only are businesses surviving in the challenging environment but that a decent proportion are thriving and reporting growth. It demonstrates just how resilient SMEs in the UK are.”
“Clearly future goals vary depending on where a business is in its journey, its size and its geography. However, whether it’s hiring new employees, expanding internationally, or succession planning, in order to succeed most SMEs will need some kind of funding. With mainstream finance retrenching from complex and often-pressing needs, it’s more crucial than ever for specialist lenders to step up and support our economy.”