Small and medium-sized firms in the North East are entering 2014 with renewed optimism and enthusiasm, new research suggests.
But the bi-annual SME Pulse report, produced by the UK’s largest insurer Aviva, also highlights how many SMEs realise they need to take extra steps to keep their businesses healthy.
The study, which surveys 500 SMEs, showed firms in the North East had a more positive outlook for the first six months of 2014 compared to the same period in 2012, with half of respondents predicting strong or improved growth during the first six months of this year. Around 68% said trading conditions in 2013 were largely as they expected, while a third said they were harder.
However, reflecting recent economic forecasts, Aviva’s findings highlighted growing levels of enthusiasm and satisfaction among the region’s entrepreneurs, with less than one in ten saying they had lost the initial verve they had for running their businesses.
Pulse also showed that SMEs in the UK recognised the need to actively manage their business performance in the first six months of 2014, with many taking extra steps to do so. Diversification through expanding product ranges or targeting new customers, for example, had increased 50% since 2012.
Among the primary concerns for SMEs during the period were maintaining good cash flow, as reported by 30% of respondents, and halting a decline in sales, as reported by 19%.
The news comes after the Journal reported yesterday how Prime Minister David Cameron was pledging a host of measures to make life easier for small businesses.
When asked what the Government could do for SMEs, 33% of the Pulse respondents suggested cutting red tape for tax and accounting, 30% said reducing VAT, 24% said encouraging the banks to lend to business and 23% said reducing corporation tax for small business owners.
Firms also wanted to see initiatives that benefit smaller businesses as well as large ones (19%), a cut in health and safety red tape (15%) and an increase in the number of SMEs benefiting from a reduction in National Insurance bills.
Head of small business at Aviva, Robert Ledger, said: “The increased optimism we are seeing is great news for the economy.”