Wraith Carter gavin1

Small business owners in the UK have warned they will abandon expansion plans for 2018 if they are unable to secure funding.

New data from Hitachi Capital Business Finance’s business barometer asked more than 1,100 small business decision-makers about how they planned to grow their business in the next 12 months and which strategies depended on securing finance.

The survey found that 43% are relying on finance as the foundation of their plans.

Among those predicting significant growth for the next three months, 65% say they will have to put various growth plans on hold if they are unable to secure appropriate funding. The same is true of younger enterprises that have been trading for less than five years (54%).

A lack of access to funding will also directly hold back any plans to open up new markets (16%) and diversify product offers (23%).

One in five business owners (21%) say a failure to secure funding will hinder their plans for IT upgrades and investment in improved systems.

Gavin Wraith-Carter, managing director of Hitachi Capital Business Finance, said: “The principle of high street lenders doing more to support the small business sector has been widely debated but we are now at a critical moment.

“The economic impact of small businesses being starved of business finance has never been clearer or more tangible. Small businesses have the nimbleness, the ideas and the entrepreneurial spirit that the broader business community can learn from in how we all make Brexit a success for British business.”

Growth activities under threat without funding% of small businesses
Compete with larger competitors  26%
Increase headcount/ hire new people 25%
Launch new products/ services 23%
Run a marketing/ advertising campaign 23%
Move to a better location/ bigger space  22%
Modernise IT capability/ purchase new IT equipment 21%
Launch into new markets outside the UK 16%
Launch into new market segments within the UK 16%
Invest in staff training programmes 16%
Invest in a new company brand/ website 15%
Pitch for major accounts 15%
Invest in new vehicles 14%
Invest in new production lines/ machinery 14%
Pay suppliers on time 14%
Pay our tax bills 10%
Adapt to new data protection laws  9%