Almost half of UK SMEs (45%) are planning to grow in the next 12 months. Meanwhile, in the first quarter of 2014, more than two-thirds (69%) reported making a profit in their previous year of trading, compared with 64% in Q1 2013.
These are the key findings of the SME Finance Monitor, published by market research consultancy BDRC Continental, which investigates the availability of external finance for UK SMEs, based on more than 60,000 interviews with businesses.
The report found there was no increase in appetite for external finance, with most SMEs (72%) defined as a ‘happy non-seeker of finance’ for the next three months. Just 12% of SMEs plan to apply for new or renewed facilities.
There has been a decline in the number of SMEs with a ‘worse than average’ risk rating, down from 56% in Q2 2013 to 47% in Q1 2014.
Furthermore, the proportion of SMEs reporting an injection of personal funds in the previous 12 months has declined over time. In Q1 2014, 30% reported having made such an injection, with 15% saying that they felt they “had to” inject funds. But this is down from a peak of 26% in Q3 2012.
Less than a third (27%) of SMEs reported that they regularly used trade credit. This increases by size of SME, and is more common among those with a minimal risk rating, and those that are also using external finance.
Commenting on the findings, Shiona Davies, director at BDRC Continental, said: “The encouraging news from this latest research is that the economy is seen as less of a barrier by SMEs.”
To see the full report, visit: www.sme-finance-monitor.co.uk
Sally Percy is editor of The Treasurer