The confident outlook comes on the back of a strong first quarter with more than half of firms reporting a rise in revenues from Q4 2021 and also compared to the same period in 2021, according to the latest quarterly Barclays SME Barometer.
Looking ahead, Scottish SMEs expect to see a 10.4 per cent average revenue rise between the months of April and June against the same period in 2021.
Colin O’Flaherty, head of SME at Barclaycard Payments, said the survey findings were a “positive sign of businesses bouncing back as pandemic restrictions have eased”.
“After an exceptionally tough time, it’s encouraging to see that businesses have seen revenues rise over the last few months, despite a challenging economic climate,” he said.
O’Flaherty said he was hopeful that the upcoming Jubilee weekend will provide a further confidence boost to many SMEs.
“However, it’s not surprising that in the immediate term, cost of living increases, rising inflation and difficulty hiring new workers are a major cause of concern for small business owners. It’s vital that they continue to tap into the support of the wider business community to get through yet another difficult period.”
The survey findings were supported by data from Barclaycard Payments which shows a rise of 28.6 per cent in the value and 29.1 per cent in the volume of payments to SMEs in Scotland in the same period (January - March) versus pre-pandemic3.
However, the survey also found that over three quarters of Scottish SMEs (79 per cent) say that rising living costs, energy bills and inflation are a long-term concern for their business. Over half (56 per cent) worry that the rising costs will negatively impact consumer spending and almost a third (30 per cent) fear it will make them less competitive as they are forced to increase their own prices and 36 per cent said they may need to re-evaluate their operations to reduce the amount of energy they use.
While they remain confident about the future of their businesses, half of Scottish SMEs (50 per cent) have a pessimistic outlook on the prospects for the wider UK economy, compared to 46 per cent of businesses UK wide and almost half (48 per cent) say that the current business environment is unstable, compared to 41 per cent UK wide.
O’Flaherty said it was not surprising that in the immediate term, cost of living increases, rising inflation and difficulty hiring new workers are a major cause of concern for small business owners.
“It’s vital that they continue to tap into the support of the wider business community to get through yet another difficult period,” he said.
Additional findings from the survey reveal that despite the challenging environment, the majority (91 per cent) of SMEs in Scotland say they are planning to invest in their businesses over the next 12 months. Almost two-fifths (39 per cent) plan to recruit new staff, while 34 per cent plan to invest in new equipment and technology and 26 per cent plan to invest in reskilling or upskilling staff.