For the second year running, the top business opportunity for SMEs is the return of clients as the economy stabilises, according to a report.
One in five SME owners (21%) see this as a key opportunity for growth in 2023 – while 20% are looking to introduce new products or services, and 19% expect to acquire new domestic clients.
Increasing revenues through new sales channels, and sticking to new working patterns such as remote or hybrid working, complete the top five business opportunities for 2023, according to the poll of 500 SME owners.
And while a fifth of small business owners in 2022 saw the closure of competitors as something to capitalise on, this has now slid down the list, with just 12% saying the same this year.
Other priorities from 2022 that are less important now include implementing new technology to improve business efficiency.
And preparing to meet Net Zero carbon targets is also seen as a business opportunity this year – despite not registering on last year's list.
The research comes as AXA UK launched its Start Up Angel competition, which is offering two prizes of £25,000 in funding, four £10,000 prizes for digital marketing campaigns, and mentorship with some of Britain’s best entrepreneurs.
Deepak Soni, director of SME business insurance at AXA UK, said: “Challenges provide opportunities, but it’s not always easy to capitalise on them.
“The last few years have been amongst the toughest for small businesses due to the Covid pandemic, so we’re doing our best to support and encourage those who have just set out on their journey.
“The AXA Startup Angel competition, which closes on Sunday, will provide an invaluable boost to a selection of small British startups.”
The 2023 report found SME owners are less worried about weak demand for their products domestically than they were 12 months ago.
Encouragingly, more than half (58%) said they have reached their main business goal since starting out.
For 22%, the core driver was to simply be their own boss, while 14% wanted to improve their work/life balance.
Deepak Soni added: “Small business owners seem less concerned about benefitting from the demise of competitors – focusing instead on launching new products and services, and reaping the benefits of clients returning to the market.
“We look forward to seeing how things may change in 2024’s report, hopefully putting Covid and other recent challenges further in the rear-view mirror.”
2023’s TOP 13 SME OPPORTUNTIES:
- Clients returning as the economy stabilises
- Introducing new products or services
- Acquiring new domestic clients
- Increasing revenues through new sales channels
- Keeping new working patterns (e.g. remote/hybrid working)
- Expansion into new locations/opening new branches
- Closure of competitors
- Realising cost savings (e.g. by reducing fixed costs such as rents)
- Increased consumer awareness of the benefits of using small businesses
- Implementing a new technology that will improve business efficiencies
- Selling more into international markets
- Impact of Brexit (e.g. less competition from EU)
- Preparing for Net Zero (carbon targets)
2022's TOP 12 SME OPPORTUNITIES:
- Return of clients as the economy reopens
- Introducing new products or services
- Expanding business and acquiring new domestic clients
- Closure of competitors
- Increased home working/retained new ways of working
- Increasing revenues through new sales channels e.g. online
- Expansion into new areas/new branches
- New technology that will improve business efficiencies
- Realising cost savings e.g. by reducing fixed costs such as rents
- Increased consumer awareness of climate change, sustainability, and ethical practices
- Selling more into international markets
- Brexit e.g. less competition from EU
