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According to the Federation of Small Businesses there were 5.8 million small businesses operating at the start of 2019. These contribute significantly to the UK economy and at Black and White Accounting, we’re proud to be playing our part to support and help them flourish.
So, at the start of 2020, I’d like to look at some of the likely challenges Small and Medium Enterprises (‘SMEs’) are likely to face in the year ahead:
1. After Brexit, what next?
Brexit is happening on the 31 January and while this now provides clarity for the direction of the UK, the actual impact is still unclear. What will future trading arrangements with Europe and the rest of the world look like? What talent will come to the UK and from where? How long will it take to negotiate new trade deals? It seems that businesses may need to continue to ride the wave of uncertainty for a while longer, which in turn may have a broader economic impact.
2. IT Security
Small and medium sized businesses don’t always have the specialist knowledge to set up and review IT security and run the risk of coming under a cyber-attack. The cost of this to a business isn’t just financial; business reputation and the confidence of clients can be severely harmed. Developing your resilience to these and understanding your legal obligations regarding data protection, especially in a post-GDPR world, will continue to challenge many businesses.
3. Environmental responsibility
The drive for shared responsibility to tackle environmental issues will continue into 2020 and businesses may need to prepare for regulatory changes to encourage greater corporate responsibility for managing their impact on the environment. This may include customer demands from businesses to demonstrate their corporate responsibility or risk losing their business. A recent blog of ours looked at ways to save tax and the environment at the same time.
4. Generating new customers
Being proactive is crucial for generating new customers, which takes strategy and planning. Many businesses understand their customers’ needs but helping the customers realise their need for your product or services, can require a different set of skills. To remain competitive, it will be essential to develop approaches within a changing political and economic background and potentially develop new skills within the business.
5. The importance of social media
The continued growth and impact of social media makes it integral for many businesses looking to increase brand awareness, connect with customers and reach out to new ones. The breadth of engagement that social media can generate makes it a powerful and relatively cost-effective tool, but the social media landscape is evolving, together with the way in which people engage with it. It’s imperative for businesses that wish to capitalise on the potential of social media to keep pace with changing trends. IT Security and Data Protection however, also remain pertinent here. We as a business are on Facebook, LinkedIn, Twitter, YouTube and even Instagram..,
Sense of optimism
Despite these potential trends, I feel that small businesses do have a sense of optimism for 2020, with 86% saying that they’re confident they will achieve their main goal. However, to help achieve their targets, agility and development will remain key.
Black and White Chartered Accountants
We want to get to know you, your business and your exit strategy, so we can set you on the right path and support you every step of the way.
If you would like to discuss any business opportunities or challenges which are keeping you awake at night and how they may impact on your business in 2020, our specialist team are waiting for you to get in touch with us. Contact Black and White Chartered Certified Accountants today, populate the “Got a Question” form on the right, or call us on 0800 140 4644.
