A survey of over 1000 UK SME’s undertaken by serviced office firm, Citibase, highlights a positive outlook for London based companies, with more than half reporting a rise in revenues since the vote for Brexit in June 2016.
The figures show a major improvement from a year ago when the same survey found only 21 percent of smaller firms reporting a revenue rise.
Across the country, however, the picture is less rosy, with a national average of just, ‘a third of firms saying sales have increased,’ reports City A.M. this week.
According to the survey, 58 percent of London’s small and medium-sized enterprises (SMEs) have enjoyed boosted revenues since the EU referendum, despite delays and difficulties over investment and fundraising.
While enjoying sales success, 70 percent of small London firms responded that they are deliberately delaying investment decisions, while 61 percent report they have had difficulties in raising finance.
City A.M notes that this echoes news from the Bank of England back in February when it said its calculations show investment has been around £7bn lower than they would have been without the Brexit vote.
Negotiating a good deal with the EU for SME’s
Looking forward to Brexit, small businesses based in the capital are reportedly more optimistic about the outcome of negotiations for SME’s than the rest of the country.
70 percent of those based in London said that they are confident the government will negotiate a good deal with the EU for SMEs, against a less buoyant national average of just 50 percent.
Given the change to start fresh, however,73 percent of London SMEs would welcome the chance to ‘press reset’ on Brexit and remain a part of the EU, compared to just 25 percent in Wales.
British firms enjoying success in the “sweet spot,”
The positive figures coming out of London are perhaps surprising given the uncertainty surrounding Britain’s political and economic climate in the wake of the Brexit vote.
City A.M claims that some British firms, ‘have enjoyed enhanced business opportunities in the past two years as the pick-up in the global economy has coincided with the devaluation of sterling after the Brexit vote in June 2016.’
The Bank of England has previously described conditions as a “sweet spot” for exporters especially with no changes at present in the trading relationship with other nations.
The survey of 1,059 SME decision-makers revealed that the uncertainty had forced them to review their office requirements, with almost three quarters (72%) stating they were now looking for leases of less than three years, compared with 57% in the first quarter of 2017.
Other new figures from Dun & Bradstreet in collaboration with the Small Business Research Centre, further highlight the key challenges faced by SME’s.
Of the 500-small business surveyed, Brexit was a noted as a key concern, with almost one in three SMEs (32%) reporting that it has negatively affected their confidence in their business’ success.
This is closely followed by the fluctuation of the pound (30%) and the result of the UK general election (28%).