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Ted Winterton 2012Edward Winterton, Commercial Director at Bibby Financial Services, takes a look at key factors affecting UK SMEs in 2016.

Today there are more than 5.4 million businesses in the UK with Small and Medium Sized Enterprises (SMEs) – defined as those employing 0 – 249 people – accounting for 99% of the total business population. It’s often said that these businesses are the lifeblood of the economy and for good reason. In 2015 it was estimated that 15.6 million people were employed by SMEs, equating to 60% of all private sector employment in the UK.

The role SMEs play in the UK economy in both output and employment is clear but the environment in which they operate is often changeable and rarely constant.

In April 2015 – ahead of the General Election – we surveyed 1,000 SME owners and asked which policies they would most like to see a new government put in place in the following 12 months.

They told us that they wanted simplicity and stability; with a reduction in business rates, a clear outline of how much they would be taxed, a simplified PAYE system and legislation to end late payments by large companies.

Fast forward just 12 months and it seems that UK SMEs have even more uncertainty to contend with.

While the Government’s Enterprise Bill – which aims to “cement the UK’s position as the best place in Europe to start and grow a business” –  is nearing receipt of Royal Assent, the UK’s place within the European Union is now unclear.

Combined with a lively debate ahead of the EU referendum on 23 June 2016, is the introduction of pensions auto-enrolment for SMEs, changes to the way in which dividends are taxed and the new National Living Wage, which was introduced on 1 April. For now, it seems as though SMEs’ collective wishes for stability will have to be put on hold.

But even against this demanding backdrop, we believe that with guidance, forward planning and the right support in place, SMEs can still grow and thrive in 2016.

Our Guide to Keeping Business Moving is based on key themes SMEs told us were important to them in Q1 2016. This includes how to increase domestic sales, improve cashflow, prepare for legislative changes and enter new markets overseas.

While the winds of change are likely to blow well into the Summer, there are steps that SMEs can take to ensure they can position themselves for growth in 2016 and beyond.

You can download our Guide to Keeping Business Moving here. Alternatively, contact us to find out how we can keep your business moving: 0808 231 9640.