The construction industry is a traditional measure of economic growth. Generally, when it’s doing well, the economy is doing well. The latest figures for some parts of the construction sector make grim reading, however. This might lead you to think that SMEs must be in a pinch as well. But this isn’t true.

Some very encouraging recent figures are actually showing that UK SMEs are in a better place than they have been for quite some time. Let’s delve into the numbers and see what’s happening.

Big Firms Flounder, Small Firms Prosper

The collapse of Carrillion came as a shock to many – the government included. The collapse of Carillion had a big impact on the many state given contracts it was responsible for, but not on the bedrock of the construction SMEs. Indeed, SMEs in the construction sector have seen their order books fuller than they have been for a long time.

Small firms have long learned to adapt and grow, largely locked out as they are from the public sector and housebuilding arenas by so-called ‘Super Firms’. And only 10 percent of construction sector SMEs are actively considering entering this market. What they are focusing on is small, residential builds, and this is what has become the domain of SMEs in the construction sector.  

The Broader Picture

Outside of just construction SMEs, the outlook for UK small business is very encouraging. More new research has found that optimism amongst smaller business is at its highest level for 45 years. At the same time, small businesses reporting low sales have also plummeted to a historic low.

This is due to a combination of factors. Newly implemented tax laws are making their positive effects known, and stronger sales – teamed with gains in operating productivity – means UK SMEs are feeling more positive and agile than they have in recent years.

The report shows that small business capital outlay has risen three points – to 61 percent. Small businesses are assured enough in where they are and, very importantly, the future, to make investments. Indeed, 21 percent of SME owners are confident of higher sales volumes going forward, which is a rise of three points. 43 percent are planning on purchasing new equipment, and 27 percent are buying vehicles, both multi-point rises from the last index.

The main obstacle to many SMEs in taking advantage of this robust outlook is financing. The opportunities are there, and many SMEs simply need the capital to take advantage.  If this sounds like your business, contact us today – GIC Capital are experts in  experts in SME working capital and can help you get the finances in place your small business needs to succeed. 

When it comes to finding and retaining the best talent, SMEs can find it hard, with research suggesting four out of five SMEs find recruiting a uphill task. Bigger competitors often snap up the most talented graduates in the most in-demand fields, as they have the reach and funds to secure almost anyone they want.

If you add to that record high employment figures in UK, finding the best people for your smaller business can seem like a difficult task. But it’s important for SMEs to supplement their workforce with the best and the brightest – how else are you to grow and prosper?

With all this in mind, let’s look at why top talent is so important and how to get it.

Smaller Businesses See Bigger Results

In a huge company, no employee really has the opportunity to stand out or drastically affect their employer’s fortunes. Rogue traders might occasionally put a sizeable pockmark in a banking institution’s bottom line, but aside from those unwelcome examples, most employees in big firms are part of a machine. Not so for smaller businesses.

In a smaller concern, the right hire can have a dramatic impact. Because SMEs are more agile and carry a smaller team, recruiting top talent can provide tangible benefits. Innovations and superior performance by a new, talented employee can set the tone for the whole workforce. What’s more, talent begets talent. Being able to show prospective employees the high-level workforce you have is likely to impress and encourage more talent to your business.

Finding and Keeping Talent

To identify and recruit the best people in the field, your business has to apply itself to the task. This means working out what makes you unique and attractive to a potential employee and fostering a culture that makes the business an irresistible choice.

You need to identify what you do that makes people stay with your business. Small businesses can often offer more in terms of job progression and skills growth than bigger companies. Make it clear what this candidate will receive for coming onboard. Businesses that hire employees are taking them from somewhere else, so what makes you the better choice?

If you have HR on-site, then invest in recruitment marketing tools. This will enable you to target jobs to the right people in the right areas. If you don’t have dedicated HR, find a recruitment agency that understands the type of employee you want – have a firm idea of the skills and experience required, so they can run with this.

Finally, remember that recruitment affects the whole business. Every person involved in the sourcing and interviewing stage should have their voice heard. When deciding on a candidate, ask if this potential employee is not only skilled enough, but of the right character and disposition for your outlook.  

Renting property is something that most SMEs and start-ups will need to do and renting a building for work-related purposes comes with its own set of intricacies and challenges.

When you sign a contract for a rented property, you enter into a lease with the owner of the property and will subsequently need to do certain things in order to satisfy what they will expect from you.

If you have never rented a property for a business, consider this your indefinite guide.

What is a lease agreement?

As mentioned above, signing a contract will mean that you enter into a lease agreement. This will set out the rights and obligations of every party that is involved. Terms that you can expect to be in a lease include:

•  Lease term. This can be anywhere between three and five years, but could be as long as 30. Much shorter leases are generally harder to secure.
•  The notice period to end the contract, including break clauses, which will allow you or the landlord to terminate the contract early.
•  Signing of the lease. Once signed, a lease becomes a legally binding document, so it’s a good idea to have your solicitor cast their eye over it before you put pen to paper. 

What are your responsibilities as a tenant?

Once the contract has been signed, the landlord will expect you to adhere to the terms in order to maintain the integrity of the property. This will include, amongst other things:

•  Making sure that the property is insured (unless this is the landlord’s responsibility).
•  Keeping the internal structures of the building safe and sound.
•  Complying with health and safety and fire regulations. 

Maintenance and repairs 

Once you become the tenant of a rented property, you will need to maintain and repair certain aspects of the building. This can be split into three sections:

• Before you move in – when you move in, the building should be in a fit state. If it is not and things need repairing, you will need to prepare a photographic Schedule of Condition.
• While you are the tenant –make sure that your landlord provides you with the relevant information about your responsibility to carry out maintenance and repairs.
• At the end of the lease – the property will need to be in a reasonable condition when you leave it. 

Costs incurred with renting

Renting property doesn’t come cheap and there are a number of costs involved that you might not have even considered.

• Legal fees – you will need to get a solicitor to check lease agreements before you sign.
• Rent and rates – you might be required to pay a deposit, which could be up to 6 months’ rent in advance.
• Service charges – these apply to multi-occupancy buildings. 

The single market benefits businesses when it comes to the movement of goods, services and people within the UK.

The single market, which is often referred to as the internal market or common market, is at the heart of what the EU stands for but thanks to Britain’s vote to leave the EU, the country’s trading relationship with Europe is up in the air, with many sceptical about what the future of trading will be like.

The benefits for businesses

When it comes to accessing the single market, businesses must accept all of the four EU freedoms – movement of goods, capital, services and people.

These four freedoms are intended to drive prosperity and because the EU is a customs union, its members impose common tariffs on imports from non-EU countries and can trade freely with each other.

Because of this, members of the EU are benefiting from trade deals that the EU strikes with other countries, but they cannot set their own tariffs.

In order to create an internal market that is fair and all-encompassing, the EU has committed to a common regulatory framework. This works by preventing a single company or country from gaining a competitive advantage as a result of getting rid of regulations.

The situation in London

The single market deals predominantly with goods, while the London economy is mainly service based. Because of this, many that it has little or no impact on the London economy, but this simply isn’t true.

1.  The single market is associated with migration and the free movement of labour, something that is of great importance to the London economy. 13% of London’s total workforce was born in the EU, and this figure has doubled over the past ten years.

2.  The single market is developing rapidly in the area of finance, which is, of course, of particular importance in London.

3.  At present, many markets are only affected in a minor way, but this could be set to change dramatically over time. For example, The Digital Single Market is likely to be of increasing importance over time as the issue of regulation of the tech giants becomes a major issue of political focus.