According to data from the latest SME Confidence Tracker, confidence among the UK’s smallest businesses has increased at the highest level since 2015

The SME Confidence Tracker is a quarterly survey of 1,000 SME owners throughout the UK.

The number of SMEs that expected revenues to rise from April through June increased 50% in Q1 of this year. Reports revealed that they expected an increase in sales by up to 13%.

  • About 39% of SMEs in the UK overall experienced a sales increase in the first quarter of the year.
  • SMEs in the Midlands overall reported encouraging sales numbers. With 42% saying that they experienced a sales increase in the first quarter.
  • 57% are expecting an increase in sales during the second quarter.

This increase in confidence mirrors a larger trend. The overall confidence index increased by six base points from 58 in Q4 of 2017 to 64 in Q1 of 2018. This index report is the highest recorded since the Q3 of 2015 – after the UK voted to leave the EU.

Over 73% of the SMEs surveyed expected to increase investment in their companies during the second quarter of 2018. 42% of respondents expressed plans to invest in training of existing staff – the top area of investment reported. Investment in digital technology ranked second at 30%, and investment in recruitment ranked third at 24%.

Planned investment in digital technology overtook planned investment in recruitment for the first time in the survey’s history. This could indicate that SMEs are planning for more automation and efficiency for the rest of this year and beyond.

Additionally, 36% of the SMEs expressed a desire to stay in the Single Market and Customs Union.

SMEs and tax efficient investments

This is good news for the companies included in our EIS and SEIS funds. The business outlook appears bright for SMEs.
In an interview for MoneyWeek, Mark Brownridge, Director-General of the Enterprise Investment Scheme Association (EISA), expressed confidence in the prospects for SMEs. He noted that Brexit may have an upside for EIS funding. After it concludes, the UK could “take back control of the state aid rulebook and rationalise rules relating to granting of EIS relief to small firms.”

Martin Sherwood, founder of Enterprise and founder director of the Enterprise Investment Scheme Association (EISA), agrees: “These results are very reassuring and show that despite Brexit, it’s business as usual for UK SMEs and confidence levels are on the rise”.

Mr Brownridge added that he remains optimistic, as “the Government seems keen to build an entrepreneurial spirit and make the UK a hub for small businesses, and we certainly believe that EIS and SEIS can play a significant part in creating that environment.”

Martin Sherwood, Partner

Martin Sherwood has many years’ experience of small company fundraising and in particular, the tax-efficient investment market, specialising in the Hospitality & Leisure Sectors. He is currently chairman of the four British Country Inns companies and of Halcyon Hotels and Resorts plc. Which was a major investor in Luxury Family Hotels, which he helped launch 20 years ago. He was founder and head of Tax Efficient Solutions, first at Teather & Greenwood (1997-2004) and subsequently at Smith & Williamson (2004-2010), which he left to found Enterprise.

Martin has been closely involved in both Venture Capital Trusts and Enterprise Investment Schemes since their inception. He is a founder director of the EIS Association (EISA), the official trade association of the EIS industry.
To find out more about our investment opportunities or anything else, please contact Martin Sherwood on 020 7843 0472 or

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