British small- and medium-sized enterprises (SME) are starting to feel more confident about the performance and resilience of their own businesses, boosted by festive forecasts.
The latest quarterly Barclaycard Payments SME Barometer, which surveyed 592 senior staff working in UK SMEs, found that over half (54 per cent) of UK SMEs are expecting revenues to increase in the fourth quarter, compared with their performance in the third.
Following last year’s restrictions, the research also revealed that almost three in 10 (29 per cent) SMEs forecasted the upcoming festive trading period will be their most successful since 2016.
The majority of businesses also remain relatively confident (56 per cent) in the resilience of their supply chains, despite a small decline in sentiment compared to the third quarter (59 per cent).
As Christmas shopping peaks, over seven in 10 SMEs (71 per cent) have put measures in place to limit the impact of supply chain challenges.
The long-term outlook for British SMEs also appears promising. While three in 10 (31 per cent) reported that the pandemic and associated restrictions was their greatest challenge of the last year, just 11 per cent expect this to remain the most significant barrier to performance next year.
More than half of SMEs (54 per cent) believe the pandemic has helped future-proof their business and made them more resilient, as many look to invest in the year ahead.
Nearly four in 10 (36 per cent) plan to hire more staff, with businesses in Wales (47 per cent) being the most active in their recruitment drive. A further 29 per cent intend to upgrade their technology and over a fifth (22 per cent) will extend their product range.
64 per cent said that they feel neutral or optimistic about the UK economy, down from 76 per cent in the third quarter.
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“It’s encouraging to see that small and medium businesses are feeling positive about their performance ahead of the festive period,” said Colin O’Flaherty, head of small business at Barclaycard Payments.
“While the overall economic backdrop remains challenging amidst rising prices, slowing economic output and muted consumer confidence, UK SMEs continue to impress me with their resilience and their focus on controlling what they can control to meet the needs of their customers as they’ve weathered the ups and downs of the past 20 months.
“While there may still be challenges that lay ahead, the data from our barometer indicates SMEs are right to feel cautiously optimistic about the prospects of their own business as they head into 2022.”