Almost seven in ten Scottish small and medium-sized enterprises (SMEs) plan to expand organically over the next few years despite uncertainty about Brexit and the prospect of a second independence referendum, a new report says.
A survey of 300 SME decision-makers across Scotland, half of whom were business owners, by business advisory firm Johnston Carmichael found that 69 per cent have ambitions to grow through non-acquisition means in the short to medium term.
“If this figure is applied to Scotland’s total SME population of 326,000 it would suggest that over 226,000 business across the country believe they can achieve growth,” the report says.
Nearly two thirds – 65 per cent – said they would fund growth with cash generated by the business. Just 12 per cent said that they would seek bank debt to finance their expansion, while 10 per cent identified private equity investors as a possible funding source.
The UK government will this month trigger Article 50 to formally start the formal Brexit process. First Minister Nicola Sturgeon has said Holyrood will seek a second independence referendum over the issue.
Andrew Ewing, partner and head of corporate finance at Johnston Carmichael, said: “It’s great to see that confidence remains high in Scotland despite the uncertainty associated with Brexit and the potential of a second independence referendum.
“At the moment, we simply don’t know what Brexit will mean in terms of free trade and the movement of people within Europe, but it appears that business owners have decided to carry on regardless until such time as there is more clarity on these issues.”