Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

‘SMEs Navigate Unprecedented ‘Poly-Crisis’ as Business Confidence Wavers’

by November 8, 2023
November 8, 2023
‘SMEs Navigate Unprecedented ‘Poly-Crisis’ as Business Confidence Wavers’

SMEs worldwide are grappling with a multifaceted and unprecedented challenge, aptly named the “poly-crisis,” according to the latest SME Barometer from Prism, which launched at the W3B Club at Rise by Barclays, the home of Fintech at Old Street.

This complex and far-reaching conundrum is characterised by a series of high-impact risk events, including ongoing economic volatility, a rising cost of living, geopolitical turmoil, labor shortages, and extreme weather events driven by climate change. The ongoing war in Ukraine further compounds this multifaceted challenge, creating a significant and lasting impact on the SME sector.

The latest insights into this “poly-crisis” are brought to light through the release of the SME Barometer, supported by Prism. This invaluable resource provides comprehensive insights into the challenges faced by SMEs as they navigate the intricacies of the current economic landscape.

The Chartered Institute of Internal Auditors’ most recent “Risk in Focus” report for 2023, underscores the pressing need for SMEs to maintain a laser focus on organisational resilience. A staggering 45% of businesses acknowledge the war in Ukraine as one of the top five risks affecting their financial stability and increasing the risk of insolvency.

In addition to these challenges, SMEs are also adjusting to a rapidly evolving customer landscape following the global pandemic. Unfortunately, this transformation is occurring against the backdrop of the United Kingdom’s economic forecast, which predicts five years of lost economic growth. The triple supply shocks of Brexit, the COVID-19 pandemic, and the Russian invasion of Ukraine, along with the essential monetary tightening to combat inflation, have taken a toll on the UK economy.

The ripple effects of overseas geopolitical events are being felt by 81% of SMEs as they struggle to meet their long-term strategic goals of accessing global markets. The uncertainty surrounding international trade post-Brexit continues to obstruct the efforts of SMEs to develop overseas partnerships and expand their international reach.

Professor Stephen Millard, Deputy Director for Macroeconomic Modeling and Forecasting at NIESR, warns of the economic uncertainties ahead. “UK GDP is projected to grow by a mere 0.4% this year and 0.3% in 2024, with an outlook that remains highly uncertain,” says Professor Millard. “There is a roughly 60% risk of a recession at the end of 2024. While there is optimism for inflation to decline, the potential for higher-than-anticipated inflation remains.”

The future remains uncertain, and policy makers must address the challenge of restoring the UK’s growth performance. One ongoing concern is the controversy surrounding HS2, a high-speed rail project in progress for 14 years. The uncertainty surrounding the project’s final destinations threatens the government’s strategy for regional development.

According to Chris Fletcher, Policy Director at the Manchester Chamber of Commerce, “The delays, changes, and re-scoping of HS2 have incurred unnecessary costs. Scrapping the northern leg would be economically and politically unwise.”

SMEs play a pivotal role in ensuring future stability, and as the economy stabilizes, a supportive business environment will not only benefit the UK’s domestic companies but also attract international investors and foster international relations. Business support must take center stage, with policy development, investment, and regulations aimed at supporting business growth becoming more crucial than ever.

Steven Mooney, CEO of FundMyPitch, a social investment platform connecting investors with start-ups and established companies seeking funds, emphasizes the importance of business support during these turbulent times. “Seeing positive economic progress is crucial for businesses to operate and support the country’s growth mission,” Mooney says. “Government and investor support is key to business growth, development, and innovation, allowing the country to defy negative forecasts and unpredictable market conditions.”

Sridhar Iyengar, Managing Director at Zoho Europe, adds, “Investing in research and development can position businesses as trendsetters rather than followers. The recent economic turbulence underscores the importance of SMEs being prepared to navigate turbulent times and innovate to drive growth.”

As the Bank of England approaches the end of its hiking cycle, attention is now shifting toward the possibility of rate cuts. The International Monetary Fund (IMF) warns against “premature celebrations,” emphasizing the importance of consistently maintained tight monetary policies to address inflation.

Despite the challenges, there are signs of hope as the UK’s economy fights to maintain a positive index compared to the EU’s stagnation. SMEs, however, are dealing with a contraction in investment, spending, and waning confidence, further exacerbated by the rising cost of living and interest rate hikes by the Bank of England. The business community, though not disgruntled, seeks fiscal reform to ease the tightening financial burden.

In the midst of inflation and supply chain disruptions, SMEs find themselves under increasing pressure to contain costs while enhancing profit and growth. Sam Townsend, Head of Marketing for Northern Europe at Esker Ltd highlights exporting involves credit risk; credit risk affects collectability of sales; and delays cost dearly.  Between order taking and cash receipt a raft of problems can arise.  Across the entire supply chain, accuracy of data is paramount. Data is the lifeblood of the modern SME.  Gathering real-time financial data from various sources across the chain and integrating it seamlessly into solutions for budgeting, forecasting, and variance analysis help accelerate the decision-making process for SMEs, and provide valuable insights for key stakeholders. 

Read more:
‘SMEs Navigate Unprecedented ‘Poly-Crisis’ as Business Confidence Wavers’

0
FacebookTwitterGoogle +Pinterest
previous post
UK’s 1.6m temp workers to receive pay boost ‘worth thousands’
next post
These 7 Bets Have the Highest RTP

You may also like

Wealth Club members invest £1 million under EIS...

August 26, 2022

Holiday home owners face seeking approval to let...

April 13, 2023

Cap on bankers’ bonuses to be scrapped within...

October 24, 2023

London businesses call for relaxation of Sunday trading...

November 20, 2023

Amazon latest tech giant to announce AI chatbot

November 29, 2023

The Business of Love: How Online Dating Platforms...

January 29, 2025

Elon Musk set to charge Twitter elite $8...

November 2, 2022

Fintech ‘innovation hubs’ set to launch around the...

March 1, 2023

CEO of Lonestar Labor Management Christopher Linton Discusses...

September 15, 2022

SASSA Internal Control Issues Highlight Value of Serge...

December 18, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Speaker Johnson reaches tentative deal with blue state Republicans to boost cap on ‘SALT’ deduction

      May 21, 2025
    • Senate unanimously approves $25,000 tax break for tipped workers

      May 21, 2025
    • Trump, Hegseth announce ‘Golden Dome,’ a ‘game changer’ to protect American homeland

      May 20, 2025
    • S&P 500, Bitcoin & XLK: What the Charts Are Saying Now

      May 20, 2025
    • A College Endowment Tax Is the Wrong Federal Policy

      May 20, 2025
    • Hegseth orders Pentagon to launch comprehensive review into ‘catastrophic’ 2021 Afghanistan withdrawal

      May 20, 2025

    Categories

    • Business (8,004)
    • Investing (1,974)
    • Politics (15,324)
    • Stocks (3,094)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved