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SMEs plan to keep up investment and employment despite inflation and cybersecurity concerns

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Rising inflation and cybersecurity are the biggest fears facing SMEs for 2018 although most firms plan to maintain investment and employment and many have high hopes that consumer demand and better technology will help their growth, according to research from Barclays Business Banking.

Overall, SMEs are split on the outlook for  2018, with 46 per cent seeing it as a year of opportunities and 49 per cent, one of challenges, according to Barclays’ annual SME Hopes and Fears Index. But most SMEs plan to maintain the same level of investment (65%) and employee numbers (68%) as for 2017. However, those making changes are generally positive, with 21% planning to increase the number of employees and 20% planning to increase investment.

However around half of SMEs expected consumer demand to positively impact growth, up from 22 per cent this time last year and 48 per cent expect the availability of better technology will benefit their business.

Inflation emerges as the biggest danger (cited by 43 per cent ) and some 36 per cent feared the impact of prices rising faster than wages, putting pressure on consumers. Other concerns included the risk of cyberattacks (highlighted by 41 per cent), the state of the UK economy (40%), fraudsters targeting small businesses (39%), and Brexit and UK politics (35% each).

Matthew Peek, Head of SME, Anglia, at Barclays Business Banking said: “The research reflects small businesses being empowered by new technology and e-commerce. Compared with a year ago, more think these developments will have a positive impact on their business. From our work with small companies in East Anglia, we see them making more use of data and online services, including our own, that help them manage their marketing and finances more easily and effectively. By making the most of these opportunities, SMEs can increase sales, cut costs and save time, strengthening their business.

“Inflation is clearly a worry, and in particular the potential for prices to rise faster than wages. Business owners are taking a prudent and cautious approach to the year ahead. However, there are positive signs of SMEs investing and hiring more staff.”

Last May, Barclays launched a major engagement campaign, Barclays DigiSafe, to raise awareness of cyberattacks, fraud and scams. It includes a £10m national advertising campaign, and provides customers with additional tools to protect themselves.

Last Updated ( Thursday, 04 January 2018 10:16 )