A new report published by AXA Insurance suggests that SMEs are entering 2012 with mixed emotions.
The report found that many businesses felt positive about an increase in revenue. Figures showed that 43% of UK small and medium sized enterprises expect their turnover to grow and only one-in-six expect to see a decrease during the coming 12 months.
There is however a distinct contrast in optimism depending on the size of the business. When it came to sole traders, only 23% believe that turnover will improve in the coming year. This figure more than doubles when it comes to SMEs with 50-99 employees where over half (51%) expect turnover to improve.
The outlook on profitability however is less positive across the board with 21% expecting it to worsen and just under 35% expecting it to improve.

While there are a large percentage of middle sized firms who expect both turnover and profitability to increase over the coming year, this does not translate into expected growth in employment levels. Only one in seven firms surveyed expecting to take on more staff during the year.
Matthew Reed, Managing Director Intermediary for AXA Commercial Lines comments: “When it comes to the fortunes of the UK’s SMEs, there is a more complex picture out there than the headlines would lead us to believe. It’s not all doom and gloom for sure. However there is a real need for valuable advice when it comes to risk management given the fact that, when asked to identify key risks facing their business, nearly a quarter of UK SMEs (23%) couldn’t name a single one. I find this quite staggering. In my view it means that brokers have a major role to play in helping their clients to both understand the risks their businesses face during these difficult times as well as manage them.”

Source: http://newsroom.axa.co.uk/media-releases/2012/smes-entering-2012-with-mixed-emotion-says-axa-commercial-lines/