UK SMEs plan to achieve high growth targets this year and are intent on leveraging what they see as unique advantage of agility and flexibility to help them adapt to changing customer demands, according to the latest research from American Express.
In a global study of senior executives of 3,000 SMEs, American Express and Oxford Economics found that confidence levels amongst UK SMEs are 10% higher than the global average. SMEs also have ambitious growth targets; with almost a quarter (23%) of SMEs predicting they will achieve impressive revenue growth averaging 10% for the next three years.
SME Pulse 2018: Strategies for Sustainable Growth reveals that SMEs believe that ‘understanding changing customer demand’ is the most important factor for generating revenue growth. While 58% of small businesses say they are effective at responding quickly to changing business demands compared to their industry peers, they are not resting on their laurels as they also claim that ‘change’ is one of the biggest challenges they need to address. SMEs plan to do this by relying on their nimble structures to implement more flexible operations and processes, develop relationships with external partners and apply agile project management systems and business approaches.
Attracting and retaining the right people is also key to business success for UK SMEs with 46% saying they are focusing on a culture of innovation. The top five ways that SMEs plan to retain and attract talent are: implementing a supportive/inclusive workplace culture, providing an attractive work environment, offering long-term incentives, a competitive salary, and providing training and development programmes.
SMEs are also taking a more flexible and agile approach to evaluating future finance options, with ease of application (30%), low fees (36%) and flexible repayment options (28%) as some of the key criteria considered when exploring business financing options.
Commenting on the study, Jose Carvalho, Executive Vice President at American Express Global Commercial Services said: “SMEs are uniquely advantaged through their close relationships with customers, and their ability to be nimble and sensitive in responding to changing demands. With agility a key competitive advantage for smaller businesses, it’s no surprise that more flexible approaches to hiring and financing are on people’s minds when it comes to adapting to and keeping pace with their customers’ needs.”