The proportion of the UK’s small business leaders that cite barriers to growth has jumped from 75% to 91% in the last six months, according to Hitachi Capital Business Finance.
For the hospitality and leisure sector, the percentage jumped from 81% in Q4 2019 to 96% in Q2 2020.
This correlates to the sharp fall in the percentage of small businesses that predict growth (falling from 39% to 14% in the last three months).
A tracking study now in its fifth year, Hitachi Capital Business Finance asked a nationally representative sample size of 1,268 small business leaders which barriers were holding their businesses back from growth.
Since the outbreak of COVID 19, there has been a fall in the percentage of small businesses worrying about general economic uncertainty linked to Brexit (down from 53% to 49%), an issue that dominated their outlook last year.
Instead, as a result of the pandemic, more businesses are looking at their own business plans and are more concerned over the future of their business (up from 27% to 32%). This trend was mirrored across all key industry sectors.
As some business sectors prepare to come out of lockdown, around half the respondents also mentioned additional specific challenges that they regarded to be barriers to getting their business back on track in the post-lockdown era. Volatile cash flow was a key challenge and many small business leaders implicitly felt high street banks were not being as supportive as they could be.
Gavin Wraith-Carter, Managing Director at Hitachi Capital Business Finance, commented: “In recent weeks many have celebrated news on the gradual lifting of lockdown restrictions, but now is the time to be sensitive to the real challenges that small businesses face when they re-open their doors for business.
“Our latest findings make clear the scale of the challenge with nine in ten business owners feeling there are things holding them back. Market related factors from Brexit and COVID 19 are hard to deal with, but there are also specific issues relating to red tape, cashflow and finance that can be tackled.”
