There has been a six-month peak in the percentage of small businesses that need to secure funding or finance in order to move forward with their growth plans for early 2025 – 57%, up from 53% in spring 2024 – according to new research by Novuna Business Finance.
Following small business concerns over the hike in employer’s National Insurance during the Autumn Budget, the new research also reveals that hiring plans for 2025 will be the biggest casualty of small businesses being unable to securing funding. One in four small business owners (25%) say they are relying on funding to increase headcount and hire new people this year.
The findings from Novuna’s tracking Business Barometer study reveal that access to finance is an issue felt by small businesses across the UK, many relying on it to activate growth plans. Regionally, the key pressure points are in London, The West Midlands and North West. Moreover, the need for funding or access to finance has risen across eight of eleven UK regions since May 2024.
Percentage of business who say their 2025 growth plans would be adversely affected if they were unable to secure funding or finance – comparisons over time by region
|
|
January 2025 |
May 2024
|
|
London |
76% |
61% |
|
West Midlands |
61% |
57% |
|
North West |
60% |
55% |
|
North East |
57% |
47% |
|
Scotland |
55% |
48% |
|
South West |
54% |
50% |
|
Wales |
54% |
50% |
|
South East |
52% |
53% |
|
East Midlands |
52% |
56% |
|
East Anglia |
49% |
47% |
|
Yorkshire / Humberside |
40% |
47% |
These findings come at a time when more than eight in ten UK small businesses (81%) are prioritising new initiatives to boost their overall growth prospects for 2025 – but for many these plans to create growth are conditional on access to funding.
The top 10 growth initiatives small business owners would be unable to take forward in 2025 without access to funding:
- Increase headcount/ hire new people – 25%
- Modernise IT capability/ purchase new IT equipment – 23%
- Run a marketing/ advertising campaign – 23%
- Invest in new vehicles – 22%
- Launch new products and services -22%
- Move to a better premises – 19%
- Invest in new production lines and machinery – 18%
- Invest in staff training programmes – 18%
- Pay suppliers on time – 17%
- Launch into new market segments within the UK – 15%
Jo Morris, Head of Insight at Novuna Business Finance: “Over the last 12 months we have noted an upturn in small business confidence, specifically since July, when more business owners have predicted growth. Coupled with this, a very large number of businesses have identified new initiatives to deliver growth through the course of 2025. This is all good news but many see funding as a challenge. At Novuna Business finance we recommend that established small business owners focus on getting their funding structure right. For example, reviewing smart and tailored ways to fund assets will, for many businesses, actually free up cash each month to deal with many of the day -to-day concerns – such as product development, paying suppliers, improving cash flow and funding a marketing campaign.”
“At Novuna Business Finance, our simple and competitive funding is designed to fit around the needs of small businesses, helping customers to buy or lease business assets. With an expert team and award-winning services, we can provide access to the finance solution our customers need, and are committed to helping them to develop and grow.”
For more information, contact elephant communications
Guy Bellamy – 07766 775216 / guy@elephantcommunications.co.uk
Wayne Terence Dobb – 07875532644 / wayne@elephantcommunications.co.uk