- Over 55% of SMEs in the North West are predicting turnover growth in the next 12 months
- Further 23% expect to maintain turnover levels as they remain resilient
- The region is significantly above the national average (43%) and that of the lowest predicted growth, London (33%)
- A majority of North West SMEs (52%) are also planning to increase investment in their business over next 12 months, with only 18% set to reduce spending
Resilient North West SMEs are expecting to grow or maintain turnover over the next 12 months despite the emerging economic challenges and cost increases, new research from Paragon Bank has found.
Conducted by Opinium on behalf of Paragon Bank, the research found that despite wider economic challenges, 55% of SMEs in the region are predicting turnover growth – the highest level in Great Britain – with 23% anticipating to maintain current levels.
The nationwide survey of over 1,000 SMEs found that nationally 43% of SMEs expected to record growth over the next 12 months – with a further 30% of expecting no change.
Nearly three in 10 North West businesses (28%) expect turnover growth of up to 5%, with 20% forecasting growth of between 5% and 10%. A further 8% expect growth of above 10% during the period.
The predicted growth for North West SMEs is mirrored by the region’s investment plans, with 52% of businesses set to increase investment in their business over the next 12 months – compared with only 18% reducing investment.
Commenting on the confidence of North West SMEs, Ashley Butterfield, Paragon Bank SME Lending Regional Director, said: “
“It is fantastic to see the confidence of SMEs in the North West region, and their expectations to grow and increase investment in their businesses. While the UK and the global economy continues to face serious challenges, it is vital that business continues, and SMEs play a vital role in both regional and national growth.
“By investing in their businesses, SMEs support the regional economy through jobs and support services – and it is essential that successful firms are able to access the financing necessary to meet their objectives. At Paragon, we are proud to support North West SMEs are we look forward to continue doing so in the year ahead.”
When asked how they considered the current position of their business, over a third of North West SMEs (37%) described their business as thriving, with half (53%) stating their business was stable. Just 2% of companies said they were struggling to keep the business afloat, with 8% stating the company was recovering.
While the research highlights predicted turnover growth and increased investment in the year ahead it also has identified the challenges SMEs are preparing for, citing as potential risks:
- Inflation impact on customers (27%)
- Cost increases (18%)
- Supply chain disruptions (13%)
- Impact of the pandemic (11%)
Commenting on the national research findings John Phillipou, Paragon Bank’s Director of SME Lending, said:
“SMEs are the backbone of the UK economy and, as this new research demonstrates, even though they are continuing to face a series of challenges they remain resilient and plan to continue growing and investing in the year ahead. Despite uncertainty over fuel and energy costs, SMEs know that they need the equipment and assets to fulfil the workload ahead. This will drive the need for careful financial planning alongside any investment in equipment.
“Their success is fundamental to our country’s growth prospects and it is vital they have access to the financial support and tools necessary to meet the challenges they may encounter.”
