Britain’s small firms are optimistic about growing next year as they hire more staff and export bigger volumes, according to a survey by the Federation of Small Businesses (FSB).
The FSB’s Small Business Index revealed that the outlook for orders, exports, hiring and growth has remained strong, with 65% of small businesses in the UK confident about expanding further in the first quarter of 2015.
Small firms’ productivity rose by more than 1% in the second half of 2014, meaning they can capitalise on growth plans in the New Year.
Finance costs limit growth
Nearly a quarter of firms (22%) said the cost of finance was a barrier to growth, up from 10% just last year. This suggests that expectations that the Bank of England will raise the Base Rate is affecting medium-term lending costs.
John Allan, FSB national chairman, said: “All the signs show that as we head into the New Year small businesses are expecting to grow and take on new staff. But to achieve these positive ambitions, small firms will need certainty in the domestic economy including interest rates.”
Financial costs as well as concerns about the economic status of Europe mean the government must continue to do all it can to support small firms.
Regional and sector variations
The mood of small businesses varies across the country; London, the West Midlands, and the east of England were the most upbeat compared to this time last year.
Meanwhile, the FSB survey showed that confidence is greatest in the IT sector, and rising the fastest in health and social work and transport.
In an information age defined by an interconnected, always on the go mindset, it can be all too easy for small and medium enterprises (SME) not to keep on top of things and maintain a high level of transparency.
The way small businesses operate has changed, and, with the advent of big data, it is becoming increasingly hard to manage the sheer volume of information that is automatically captured.
To streamline operations and ensure that rapport with customers remain solid and mutually beneficial, it pays to invest in technology. The biggest game-changer over the last 20 or so years has been the evolution of customer relationship management (CRM) systems.
This asset – CRM – is a powerful, easy to use and intuitive way of supervising how organisations engage and nurture the relationship they have with their existing customers and also that of potential leads.
Writing in the Guardian recently, Nadia Finer, founder of smartli.co, a site “dedicated to sharing the smartest stuff for start-ups and small business”, says that more than ever before, CRM systems are the lifeblood of any organisation.
“CRM can help you grow your business and keep customers happy by keeping track of interactions and tasks, and giving you a clear view of your sales pipeline,” she highlighted.
“As your business grows, so will the amount of client data you and your team need to manage. Instead of relying on lots of different lists and spreadsheets, a CRM will keep all your client info in one easily accessible place. No more mistakes, missing files, omissions or unnecessary repetition.”
CRM also frees up time from laborious activities that prevent you from doing the things that matter most, such as driving innovation and engaging with stakeholders, the expert outlined in her piece for the newspaper.
For example, because any given day is full of endless conversations, tasks and activities, which comes on the back of pre-existing correspondence and efforts, there is a lot of data to contend with.
Without CRM, everything becomes more manual and ultimately more bureaucratic. This can lead to confusion, extensive paperwork, errors and duplication. This is cancelled out by smart technology. The possibilities are quite literally endless.
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