Tailored support for SMES ‘could unlock £140bn’

Small and medium-sized companies in the UK are facing a “big productivity and sustainability challenge”, according to a new report by Natwest.

The findings were published in the 2021 Small Business Report, an industry-wide review into UK SME recovery, carried out in consultation with the British Chambers of Commerce (BCC), and the Federation of Small Businesses (FSB).

The research of more than 1,000 UK SMES, which will be shared with the Government, analysed more than 100 reports and support programmes globally to identify the barriers facing SMES.

According to the report, the South West’s 562,545 SMES (firms with one-249 employees) are responsible for 48 per cent of the region’s turnover and 49 per cent of the region’s private sector employment, but productivity lags behind that of larger firms by 15 per cent.

It found that SMES often struggle to find support tailored to their needs and that personalised assistance could unlock around £140bn into the economy – equivalent to around 400,000 new SMES.

The report said growth could be achieved by:

■ Transforming a greater share of SMES into scale-ups – enterprises that grow by more than 20 per cent year-on-year in turnover and/or employment for at least three years

■ Increased female entrepreneurship and productivity of womenled firms

■ Improving black, Asian and minority ethnic workforce participation and career progression

■ Driving an SME shift toward sustainability

Natwest has announced a series of interventions including a funding commitment of £6bn to support SMES to scale and grow, with £4bn of that allocated outside the capital, and the creation of 30 local enterprise managers and 20 entrepreneur acceleration managers.

Adam Marshall, director general of the BCC, added: “SMES are the engine-room of the economy and their ability to bounce back and grow exponentially will be crucial to the UK as a whole as it emerges from lockdown.”