1 in 3 small businesses haven’t grown in the last 5 years, according to research by Association of Accounting Technicians (AAT).
In a study of 1,000 small businesses, 33% hadn’t experienced revenue growth, and 31% hadn’t seen profits increase since 2010.
56% identified clear factors that have held their businesses back from expanding.
- lack of capital to expand
- too much red tape
- lack of support from banks
- uncertain global economic conditions.
Future forecasts were more optimistic with 76% of businesses expecting an increase in revenue and 78% predicting profits to rise over the next 5 years.
However, 58% admitted to not having a business plan to help them grow, with 10% unsure on how to put one together.
Mark Farrar, chief executive of ATT, said:
“Growing your company can be one of the hardest stages in the life of a business but with the right skills it can be done. Growth can put pressure on cash flow which is why many businesses fail when they’re expanding. Having the necessary financial skills and a clearly defined business plan are essential tools to help firms expand successfully.”