Two-thirds of small firms plan to invest in their business this year

The latest SME Barometer from Barclaycard indicates small green shoots of recovery for the UK’s business community, as the nation’s COVID-19 lockdown starts to ease.

Almost two-thirds (64%) of business owners surveyed for the SME Barometer confirmed they still plan to invest in their business during the next 12 months.

The primary focus of investment for entrepreneurs and their businesses include marketing (26%) and new equipment and technologies (20%).

The data also revealed that the number of businesses actively taking payments for goods and services since early April – the peak of the coronavirus pandemic – had risen by almost a quarter (24%). This tallies with the growing number of businesses working hard to reopen with adequate social distancing measures in place.

Almost three-quarters of small businesses surveyed anticipate coronavirus having a major impact on their cash flow projections for at least the next quarter. However, less than a fifth (19%) foresee COVID-19 harming their business for more than 12 months.

The SME Barometer does highlight the disparity between micro, small and medium-sized firms in terms of their ability to keep revenue flowing.

Micro businesses surveyed said Q2 2020 is likely to result in a 30% drop in revenue from the previous quarter, significantly more than small and medium-sized businesses.

Nevertheless, almost two-thirds (64%) of medium-sized firms have been forced to cut staff working hours or lay off staff, compared with the national average of 47%. Small businesses are more likely to experience delays to their supply chains with almost half (47%) reporting difficulties compared to the national average of 37%.

Konrad Kelling, head of small business acquiring, Barclaycard Payments, said: “It’s encouraging to see small and medium-sized businesses starting to come online again as we emerge from lockdown.

“While we don’t expect an overnight recovery, the resilience and perseverance of small businesses gives us optimism as we look towards the next 12 to 24 months.”

Date published 29 May 2020 | Last updated 20 Mar 2024