Fast-growing SMEs want continued access to EU single market and workforce post-Brexit

Fast-growing SMEs overwhelmingly want the UK government to push for continued access to the European Single Market in forthcoming Brexit talks with the European Union.

So say private equity house ECI partners, who for the last 7 years have commissioned an annual survey of the UK’s high-growth companies or gazelles – the small and medium enterprises (SMEs) whose growth rates are well above the average.

This year’s ECI Growth Survey – conducted in the weeks following the Brexit referendum vote to leave the EU – finds that 82 percent of fast-growing SMEs want continued access to the Single Market, and 58 percent want to continue hiring EU workers post-Brexit.

fast-growing SMEsA new survey suggests the UK’s fast-growing SMEs want the government to put continued access to the Single Market and ability to continue hiring European workers at the top of the agenda in Brexit negotiations with the European Union.

Over three-quarters (77 percent) of gazelles are facing some level of skills shortage, especially in technical, engineering, and research and development roles.

They call for closer links between business and education and for an expansion of apprenticeships.

Last year’s survey revealed that fast-growing SMEs were overwhelmingly (91 percent) in favour of the UK remaining a member of the EU.

This year, more than two-thirds (69 percent) said they were concerned about the economy and what they most fear right now is a downturn.

Access to finance

The survey also reveals that 51 percent of fast-growing SMEs are finding it difficult to access finance – more than double the figure for last year (22 percent).

Could this be linked to the findings of another survey that found many UK firms are unaware of alternative finance options?

However, in spite of this, over two-thirds (67 percent) of fast-growing SMEs said they expect to increase revenues in the coming year, with 43 percent forecasting growth in double digits.

Nearly a third plan to significantly increase investment and take on more staff – compared with only 6 percent planning cuts.

North America and Europe remain top export destinations for UK’s fast-growing SMEs.

Raising UK productivity ‘has never been more important’

In the foreword to this year’s report, Carolyn Fairbairn, Director General of the CBI, says:

“As the UK seeks to forge a new relationship with the world, raising the productivity of our economy has never been more important. It is productivity growth that will help spread prosperity outside London and the South East and drive the UK economy through the uncertain times ahead. The success of the UK’s fastest growing firms will be vital in achieving this goal.”

Some respondents suggest using Brexit as an opportunity to cut down on red tape. They also commented on the likelihood of lower interest rates, declining inward investment, and the fall in value of sterling.

Sean Ramsden, CEO of British food wholesaler Ramsden International, and one of the survey respondents, says:

“We are an exporter so we have benefited from the fall in the value of sterling. Our hope is that post-Brexit, Britain will be able to negotiate better trade deals with countries like Canada and Australia. We are seeing demand grow at a faster rate in markets outside Europe.”