UK Small Businesses have had their say in the latest Novuna Business Finance’s Business Barometer study, and it shows that they’re not confident in their business’ ability to grow during the coming 3 months. Novuna’s study measures a full range of opinions and feelings from a range of UK business owners. The study collects data every quarter, and has done so for the past 11 years. The most recent data shows that less than 30% of business owners surveyed predict growth in the coming quarter. That’s down from over 35% during the summer of 2024 and marks a four-year low overall.
What Is Causing The Downshift In Growth Confidence?
Thankfully, the Novuna study collects lots of data from its over 1000 small business owners, so it also explores why the mood is shifting for smaller businesses. Some of their biggest concerns include:
- economic volatility following the past two budgets (69% of business owners identified this as a concern)
- US tariffs impacting UK business operations (12%)
- US tariffs indirectly impacting UK business via EU supply chain (21%)
- Fear of UK tax rises (48%)
- Geopolitical events reducing consumer spend (30%)
When you combine all of these factors, it’s understandable that so few small business owners in the UK are predicting growth in the next quarter.
Some Positives To Consider
In the business world we have a tendency to look at things rather negatively, especially when you hear that small business confidence is down. And whilst confidence is clearly down and that is a cause for concern, you have to take into account the context surrounding that.
First, the question asked to UK business owners specifically asks about projected growth over the coming quarter/3 months. Given that so many business owners will be considering the current economic climate (which is volatile right now), they’re bound to skew more negatively because they’re looking to the short term future.
Another thing to consider is that the survey is designed for small business owners. Whilst this can give a great view into UK businesses more generally, smaller businesses will always be far more cautious than medium and larger businesses, as they have more at stake and less of a customer/product base to lean on when things get tough.
Business Growth Confidence: Final Thoughts
We’re not ignoring the gravity of the situation here. Small businesses are nervous about their business’ ability to grow – and many medium enterprises will be feeling the same way, too. That’s a problem and it reflects a cautious attitude throughout the UK when it comes to business activity.
But if you stay the course, show commitment to your business, products, services, and staff, then you could be surprised by the growth you could see in the coming months. As we’ve seen from Trump’s Tariffs, the economic situation can change with the wind sometimes, but being confident in your business offerings and preparing for all eventualities is the best thing you can do to weather the storm and come out on top.