×

Small digital firms ‘optimistic despite challenges’

Tuesday 11th April 2017

Small digital firms across the UK are relatively optimistic about their prospects for future growth, despite potential challenges to the business environment and the economy as a whole, research has suggested.

The eBay for Business Index was based on a survey of more than 400 small enterprises, nearly half (46 per cent) of which felt confident about their chances of achieving growth. Less than one in five (19 per cent) had a pessimistic outlook.

Export sales and product diversification are expected to be the biggest drivers of growth.

There is no doubt that the coming years could raise some obstacles for emerging companies to overcome, but 52 per cent of the respondents to the eBay survey were tired of hearing predictions of “doom and gloom” that had no immediate impact on their growth potential.

Nearly three-quarters (72 per cent) of firms felt confident that they were in control of their own destiny as far as commercial success is concerned.

One of the businesspeople surveyed was Monty George, managing director of Furniture Box, who said it’s not necessarily a case of expert analysts and commentators being “wrong”, but more about the fact that macroeconomic factors such as the strength of the pound are outside business owners’ control.

“Whilst they can have an impact on business, you can’t let them affect your ambitions,” he continued. “As an entrepreneur you’ve got to be bold and invest for the growth of your business or idea.”

When it comes to the potential challenges that growing enterprises need to be aware of, a reduction in customer spending was cited as the biggest concern, with 41 per cent of digital enterprises raising this issue.

Uncertainty around Britain’s exit from the European Union (36 per cent) is another potential risk, along with unforeseen political incidents (28 per cent), expensive imports (22 per cent) and unsatisfactory broadband (12 per cent).

Discussing the findings, Dieter Newell, senior director of seller growth at eBay UK, said: “Britain’s online enterprises are showing an impressive resilience in the face of economic uncertainty, with a quarter telling us they have become better prepared for risks in the past year.

“That said, a number of risks remain, with a weak pound and consumer confidence chief among the concerns expressed by the businesses we’ve spoken to.”

Small firms working to increase their chances of future success by keeping costs down can look for ways to be as flexible as possible in their working methods. When it comes to workspace, one option is to go for short-term office hire, which can be much more affordable and less of a commitment than a long-term lease.

This sort of flexibility is becoming increasingly important in modern business, with more and more companies searching for innovative ways to boost productivity by giving staff more freedom and independence.

 

Posted by Frances Singer

Image courtesy of iStock/Pinkypills

Back to Blogs