Wendy
12/6/2024 11:24:19 AM
3 mins read
More than eight in ten (81%) UK small businesses are prioritising new initiatives to boost their overall growth prospects for 2025. Increasing new business sales (43%) and reducing fixed costs (24%) are priority areas business owners want to focus on – but there’s also evidence the recent changes to employers’ National Insurance could significantly impact hiring plans for 2025. Nationally, only 7% of small businesses surveyed are prioritising making senior hires for 2025 – and only 9% of small business owners plan to hire young people that they can train and develop.
The findings are from the quarterly Business Barometer study by Novuna Business Finance, and the new data suggests the firm resolve by small businesses to invest in business development for 2025 follows resilient growth forecasts for this current quarter. Nationally, the percentage of small businesses experiencing quarterly growth stands at 35%, as the period since July 2024 represents a two-year high in small business growth forecasts.
Regionally, growth planning for 2025 is being driven by the same regions that reported a strong growth outlook for Q4 2024. Small businesses in London (94%), the West Midlands (83%) and North East (83%) are most likely to be investing in future growth projects for 2025 – and these were the same regions that have enjoyed an upturn in growth forecasts this quarter.
By industry sector, small businesses in the media (92%) and manufacturing (90%) sectors are most likely to be prioritising new growth initiatives for 2025 – and the Novuna data shows there are year-on-year increases across five industry sectors – manufacturing, construction, retail, media and agriculture.
Percentage of small businesses prioritising new growth initiatives for 2025 in order to make their business stronger – results by sector
|
Q4 2024 |
Q4 2023 |
|
|
Media |
92% |
87% |
|
Manufacturing |
90% |
83% |
|
IT / Telecoms |
87% |
88% |
|
Retail |
85% |
82% |
|
Hospitality |
83% |
86% |
|
Agriculture |
79% |
75% |
|
Construction |
79% |
76% |
|
Finance & Accounting |
79% |
83% |
|
Medical Services |
75% |
83% |
|
Legal Services |
67% |
79% |
|
Real Estate |
72% |
79% |
|
Transport & Distribution |
70% |
78% |
Top 10 initiatives to power growth in 2025
Nationally, more than two in five small businesses are looking to increase new business income for 2025 which, for one in five, involves diversifying their business model and developing new products and services. Financial prudence is also seen to be key for the year ahead – both in terms of doing more to tackle fixed costs and building up financial reserves.
|
National average |
Sector most likely to be doing it |
Region most likely to be doing it |
|
|
Increasing new business income/ sales |
43% |
Manufacturing - 51% |
North West -52% |
|
Reducing fixed costs |
24% |
Hospitality & Leisure -36% |
North East -35% |
|
Building up financial reserves |
23% |
Hospitality & Leisure -31% |
Yorkshire/ Humber -33% |
|
Diversifying the business, offering new service lines/ products |
21% |
Medical Services - 31% |
Yorkshire/ Humber -28 |
|
Planning ahead with business budgeting |
20% |
Manufacturing -25% |
Wales -31% |
|
Advertising online to increase awareness or sales |
18% |
Retail -24% |
North East -24% |
|
Invest more money in marketing the business to raise awareness of our brand and services |
16% |
IT & Telecoms - 24% |
London and South East -21% |
|
Spending time investing in the people that already work at the company |
14% |
IT & Telecoms - 20% |
West Midlands -23% |
|
Having more contingency plans in the event of prolonged market uncertainty |
12% |
Construction -18% |
Wales -17% |
|
Expanding into new geographical markets |
12% |
Medical Services-20% |
London -22% |
|
Investing more time/ money to improve the digital the capabilities of the business |
12% |
Medical Services -19% |
London -26% |
Joanna Morris, Head of Insight at Novuna Business Finance comments: “A lot of attention in recent weeks has been on the Autumn Budget – and whilst our data suggested that 86% of UK small business owners were fearful of Budget announcements, in truth small businesses finish 2024 in a resilient position. The percentage of enterprises predicting growth has been at a two-year peak since July and, on top of this, a huge proportion are already prioritising growth projects to invest in for the year ahead. At Novuna Business Finance, we are committed to helping established businesses to fulfil their true potential to ensure the resurgent confidence of small businesses can be further built on in 2025.”
