Originally posted on 18 Dec 2013

This winter will see the strongest SME growth since the financial crisis began, according to a new report from the Centre for Economics and Business Research (Cebr) and British Gas Business.

The report, The Importance of Winter for SMEs, predicts £400bn of revenue for the UK’s small businesses during winter 2013/14, representing a 7% increase on the same period last year, and 12% up since winter 2010/11. Wholesalers have the largest opportunity, with an estimated £130 billion of potential revenue available, whilst retail and manufacturing businesses are looking to share a slice of £24bn and £42bn respectively.

The report makes useful reading for those who advise SMEs, particularly accountants:

  • The winter growth opportunity varies by SME sector. Educational businesses have the largest proportion (27.2 %) of turnover in winter, as the long summer hiatus pushes work into other parts of the year. Winter is quietest for construction firms, who only see around 22% of their annual turnover fall between December and February.
  • Yet the winter months also present a number of significant challenges for SMEs. The lead up to Christmas brings bumper sales for many retailers and other businesses, but this is typically followed by depressed revenues in January and February that result in more SME liquidations and bankruptcies in the first quarter compared with any other time of year. The report forecasts that more than 3,000 small businesses will fail in the first quarter of 2014, which would represent a 14% decrease on the same period this year.
  • Severe weather can compound the pressures on small businesses. Cebr have forecast that a repeat of the kind of supply chain disruption caused by snow and colder weather in 2010 would cost the economy more than £1.9bn this winter, wiping 0.5% off UK economic growth.
  • As cases of flu peak during December and January, illness also poses a major human resources risk, particularly to the 75% of SMEs in which the owner is the only employee. In businesses where the owner is the only employee, the business could stand to lose as much as £200 for every day they are absent from work.

I’ve already gone on record to say that the SME market is one of great potential and growth for accountants who are arguably in the best position to assist SMEs. Download the full reportfrom Cebr and British Gas. Registration is required.

Read the Cebr press release here.

Martin Pollins

Managing Director at One Smart Place
Martin Pollins is a Chartered Accountant and MBA with wide experience in corporate finance and business management. He has served on the boards of several companies, including those listed on the London Stock Exchange, AIM and OFEX. He is Chairman and Founder of OneSmartPlace and was a Council member of the Institute of Chartered Accountants in England and Wales from 1988 to 1996. He was managing partner of PRB Martin Pollins, based in Sussex, the first Accountancy firm to advertise on British television.He went on to create and launch the CharterGroup Partnership (the UK’s first Accountancy network) and then LawGroup UK (at the time, one of the largest networks of lawyers in the UK). In recent years, he helped to raise several £millions to fund British films such as The Da Vinci Code, Bridge of San Luis Rey, Head in the Clouds and Merchant of Venice with actors such as Charlize Theron, Robert De Niro, Al Pacino, F. Murray Abraham. Kathy Bates, Gabriel Byrne, Geraldine Chaplin, Tom Hanks, Ian McKellen, Audrey Tautou, Penélope Cruz, Steven Berkoff, Lynn Collins, Jeremy Irons, Joseph Fiennes and many more.

He has written over 700 business publications (see Glossaries at http://onesmartplace.com/resources/glossaries/) and is editor of Better Business Focus (see http://onesmartplace.com/resources/better-business-focus-magazine). His Blog, on a wide range of subjects can be found at: http://onesmartplace.com/blog/
Martin Pollins

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