SMEs plan to invest £ 150,000 in the coming months as restrictions ease

Originally written by Anna Jordan about Small Business

The average SME intends to invest £ 150,000 in the near future as easing measures lead to growing optimism.

Those in construction (£ 225,000) and transportation (£ 209,000) plan to invest even more.

Bibby Financial Services’ Pandemic Recovery Survey shows that three quarters (75 percent) have a positive outlook and 74 percent believe demand will return to pre-pandemic levels by Christmas.

SMEs across the country have started to outline their plans for a return to a more open economy. Six out of ten (59 percent) see the acquisition of new customers as the main reason for optimism.

Three fifths (61 percent) plan to provide part of the money for training and further education of staff (39 percent) and for new staff (29 percent). This means that almost a third of the UK’s six million SMEs plan to increase their workforce – giving the UK economy a big boost.

This is in line with a Bank of England forecast that is more positive than expected. The new forecast predicts GDP will grow 7.25 percent this year as budget spending soars from £ 200 million in lockdown savings.

However, there are still challenges for SMBs including late payments, bad debts and Covid loan repayment. Almost two-fifths (39 percent) haven’t thought about it yet or don’t know how to repay these loans. The average SME now owes £ 116,376, and more than a quarter (26 percent) say they need cash flow support more than ever. SMEs that had bad debts during the pandemic are twice as likely to be in survival mode – 32 percent versus 14 percent on average.

> See also: What if I can’t repay my bounce back loan?

According to estimates by the National Audit Office (NAO), the Department of Business, Energy and Industrial Strategy (BEIS) and the British Business Bank (BBB), between 35 and 60 percent of Covid borrowers can default. The FSO’s results also show that 55 percent plan to repay these loans with corporate profits.

Jonathan Andrew, Global CEO of BFS, said: “UK SMEs have had an incredibly difficult year and it is fantastic to see the vast majority optimistic about the year ahead. It is difficult to predict how the pandemic will affect the UK economy in the long term, and it is unlikely that this will be clear for some time. However, when demand normalizes again and SMEs try to meet it, cash flow will be of the essence. “

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SMEs plan to invest £ 150,000 in the coming months as restrictions ease

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