UK SMEs stay positive amid Brexit economic turmoil
Following a range of predictions in the run-up to June’s EU Referendum, SMEs mirrored the national decision to leave the EU, with 53% of SMEs voting to leave, compared to 47% who opted for a remain vote.
93% of SMEs expressed no ‘regrexit’, with 91% of leave voters and 95% of Remain saying they would vote the same again, given the chance.
Unsurprisingly, SME’s views of the future financial outlook for their businesses reflect the way they voted. Of those who voted to leave, 61% are optimistic about the short-term financial impact on their business, increasing to 77% for the long-term outlook. Conversely, less than 20% of Remainers are optimistic about either the short or long term financial impact on their business (13% short-term and 17% long-term).
The picture of an SME business community with divided views of their financial future is similar to the views expressed by consumers of the economic outlook for the next 12 months. 64% of consumers who voted remain believe that the economic situation will worsen compared to 33% of Leavers who think it will improve and 50% who foresee no change. A further indication of this uncertainty is evident among the 28% who say they are less likely to make major purchases.
Demonstrating positive support for SMEs is a key challenge for Theresa May and her newly appointed government as it will both endorse SME leavers’ confidence in the future and provide re-assurance for the pessimistic remainers that their worst fears will not be realised. Consumers showed themselves to be aware of the importance of supporting businesses when they offered the following advice to Theresa May, ‘Try to negotiate a good leaving deal for us, as while we export a lot to Europe they could impose a tariff on our goods making them more expensive’ and even more colloquially, ’Grovel to keep trade agreements’.
Amy Cashman, UK managing director of financial services and technology at TNS, commented:
“With the cabinet’s radical changes under Theresa May’s leadership, businesses are looking to the new PM to negotiate a deal that works well for small businesses.
“Despite SME’s divided views on what Britain’s future economic situation looks like, the majority stand by their voting choice and are not suffering from ‘regrexit’. As a result, the challenge will be to make both sides feel like winners.”
The findings reported are part of an ongoing SME forecasting survey by TNS called ‘Business Minds’. Key SME owners and decision-makers are invited to participate in a monthly ‘magazine’ format which intersperses serious business topics with predictions on main economic and business indicators and more light-hearted content.