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Record Business Growth Sentiment for UK SMEs

Confidence among UK SME owners regarding five-year growth prospects has hit a record high, according to the latest Business Growth annual survey by Santander Corporate & Commercial.


  • UK business owners forecast average annual growth of 33% over the next five years – the highest number since the Santander Business Growth annual survey began in 2011 
  • A fifth of business owners say their business has never been in better shape, compared to 13% in 2013 
  • The number of businesses looking at acquisitions for growth in the near future is also up (17%) 

Confidence among UK SME owners regarding five-year growth prospects has hit a record high, according to the latest Business Growth annual survey1 by Santander Corporate & Commercial. It found that businesses with an annual turnover of up to £20 million are predicting turnover growth of 33% a year on average – the highest such number since the survey began three years ago.

One fifth of business owners (20%) reported that their business has never been in better shape, up sharply from 13% in 20132. The figures were matched by a strong outlook for employment, with just under a third (30%) of companies stating that retaining existing staff was an ‘immediate priority’ – up from 19% in 2013 – and ranked now as the second most important priority after ensuring the survival of their business (57%). One in eight (12%) respondents said they were focused on hiring new staff.

More SME owners also reported that they are looking at acquisitions for growth, with the number reporting this to be a priority rising to 17%, up from 14% in 2013. Moreover, just under a third (29%) of business owners said they were looking to grow their business organically. A quarter (25%) said the long-term aim for their business was to grow it regionally, while 6% said they were targeting long-term growth internationally – double the number from 2013 (3%).

Despite the strong optimism and business confidence, business owners still report facing challenges. A tough trading environment was still seen as the biggest challenge to growth by UK businesses, cited by 47% of respondents (compared to 46% in 2013). A fifth (22%) said that reducing costs was a priority, although this is down significantly from 33% in 2013. 

Access to capital was also seen as a challenge by a quarter (25%, versus 26% in 2013), while 18% of businesses said their ability to hire and retain the right staff was a concern, up from 14% in 2013.

Despite these challenges, however, the number of business owners looking to sell their business and retire has fallen from 25% in 2012 to just 17% this year (19% in 2013). 

Marcelino Castrillo, Managing Director of SME Banking at Santander, said: “It’s extremely encouraging for UK plc that business confidence in the UK is at its highest level for three years, with businesses focused on growth both at home and overseas. While business owners report that trading conditions remain challenging, a fifth believe that their business has never been in better shape. The outlook for staff retention and new job creation is also positive, which is welcome news for the wider UK economy.  

“Santander is committed to helping businesses prosper and has been a consistent supporter of businesses in the UK, with lending over the last four years growing by an average of 17% per year. Our innovative Breakthrough programme is designed to support the UK’s best fast-growing small businesses and our International proposition supports UK companies by providing them with access to a worldwide network with proven expertise in international finance.”

Santander has extended £5.8bn of new facilities to UK SMEs and corporates in the first nine months of 2014. The bank offers dedicated relationship banking support to companies of all sizes through its 50+ regional Corporate Business Centres across the UK. 


What is the ultimate aim for your business (£50k-£20 million annual turnover)





To build it regionally




To pass it on as an inheritance to family members




To sell it and retire




To build it internationally




To sell it and start a new venture




Don’t know









Current turnover and expected annual growth


Average turnover

Expected annualised growth over next five years

South East



South West



East Midlands



West Midlands












North West









Source: Santander Business Growth 2014*

- Ends -

The information contained in our press releases is intended solely for journalists and should not be used by consumers to make financial decisions.

Notes to Editors
1 Research conducted by BDRC Continental among 500 companies with a turnover of over £50,000 between 2-6 June 2014 using an online methodology.
2 Research conducted by BDRC Continental among 500 companies with a turnover of over £50,000 between 3-13 June 2013 using an online methodology.
3 Research conducted by BDRC Continental among 502 companies with a turnover of over £50,000 between 6-13 June 2012 using an online methodology.
* Please note estimated figures for Northern Ireland, North East and East of England have been excluded due to insufficient sample sizes

Santander Corporate & Commercial provides dedicated relationship banking support to businesses with a turnover of more than £250,000. It is part of Santander UK, a leading financial services provider in the UK which offers a wide range of personal and commercial financial products and services. At 30 June 2014, Santander UK serves around 14 million active customers with c. 20,300 employees, almost 1,000 branches and 52 regional Corporate Business Centres. Santander UK is subject to the full supervision of the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in the UK. Santander UK plc customers are protected by the Financial Services Compensation Scheme (FSCS) in the UK.

About Us
Banco Santander (SAN.MC, STD.N, BNC.LN) is a retail and commercial bank, based in Spain, with a presence in 10 main markets. Santander is the largest bank in the euro zone by market capitalization. Founded in 1857, Santander had EUR 1.34 trillion in managed funds, 107 million customers, 13,225 branches – more than any other international bank – and 183,648 employees at the close of June 2014. It is the largest financial group in Spain and Latin America. It also has significant positions in the United Kingdom, Portugal, Germany, Poland and the northeast United States. In the first half of 2014, Santander registered EUR 2.756 billion in attributable profit, an increase of 22% from the same period of the previous year.

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