New minimum wage rates that will apply from the 6th April 2020. 

It’s time for big businesses to move over, mid-sized firms are leading the way when it comes to economic growth in the UK. Ambitious small businesses are taking steps to seize opportunities and put their expansion plans into action, taking optimistic outlook in spite of Brexit gloom from their larger counterparts.

A report published in 2016 forecasting to 2020 is proving true in its positive projections for the mid-market. While large businesses are making headlines with the pessimistic view of UK opportunities amid Brexit, medium sized businesses are taking a much more bullish approach. Now mid-way through the projections, reviewing them shows just how far medium sized businesses could go.

Between 2015 and 2020, the mid-market contribution to GDP was expected to increase by £50 billion, an 18% increase. With small business contribution expected to decline, it clearly indicates that more small firms are making the jump to medium sized business to match their ambitions. The eagerness to explore exporting, even with Brexit looming, it underscored in the findings too. Fast growth companies dubbed ‘gazelles’, those that have exhibited a turnover growth greater than 10% every year for at least five years with a turnover of at least £30 million, are alone expected to account for £1 in every £5 of exports.

Boosting regions and shifting away from London

One of the interesting things the report highlighted was how the growth of the medium sized business market would change the UK economy in terms of where businesses are based. While large companies typically have a London focus and the government has a vision of creating a northern powerhouse, SMEs are far more likely to work in diverse location, a positive for many local economies.

For example, while large businesses were expected to decline in their share of value contribution across all regions except the capital in the four-year period, the mid-market expected nationwide growth with a decline seen only in the North East. For communities, workers, and the wider economy, a shift away from London represents a positive change.

Challenges to overcome

While the report and sentiment from medium sized businesses have been positive, there have been challenges to overcome if firms with big plans are to reach their full potential. The report called for tax cuts and a plan to support mid-sized businesses in accessing the highly skilled workers they needed, making the difference between rapid economic growth and stagnation.

Another key area where the report called for change was the current access to finance. SMEs have historically found it notoriously difficult to access the lines of credit from traditional lenders they need to realise their ambition, even when they have opportunities that will secure the further growth of the business. Here, the alternative lending market has stepped up to offer a range of flexible solutions that match the needs of ambitious companies. Here at GIC Capital, we pride ourselves on working with SMEs to secure their future.

 It’s time for big businesses to move over, mid-sized firms are leading the way when it comes to economic growth in the UK. Ambitious small businesses are taking steps to seize opportunities and put their expansion plans into action, taking optimistic outlook in spite of Brexit gloom from their larger counterparts.

The collapse of Carillion, a major British multinational facilities management and construction services company, has highlighted some major downfalls within the UK construction industry and has even led to a report being published by Constructing Excellence, revealing that 43% of construction firms prioritise immediate financial goals over organisational resilience.

So, what else have these reports revealed about the financial situation of construction firms and what steps can be taken to improve it in terms of building better financial models?

The findings

The reports revealed that senior business managers and executives within the construction industry highlighted a number of financial issues as being detrimental to their business goals, including inadequate budgets, insufficient senior management focus on resilience and a lack of skills or knowledge related to ensuring business continuity could be achieved.

At present, the construction industry is a major player within the UK economy, contributing £138bn in value added to the UK economy and employing 3.1 million people, which equates to 9% of the total UK workforce.

With the uncertainty of the UK economy still a present issue, what can leaders within the construction industry do to remain on top?

Embrace the benefits of new technology

Providing staff with new technology will ensure that the industry remains dynamic and will also help with boosting productivity and efficiency. For example, 3D BIM modelling can help with project planning and also material acquisition.

Listen to your staff’s needs when it comes to training

If you want to improve your company’s credentials, it’s important that you listen to the people that are working for you and adjust your training accordingly.

Manage your client’s expectations 

With large construction projects, it’s inevitable that there are going to be setbacks and areas of tasks that don’t go exactly according to plan. Because of this, it’s important that you set realistic timeframes and expectations with stakeholders before going ahead with a project.

Planning is everything

It might sound fairly obvious and rudimentary, but effective planning is crucial to businesses that are operating within the construction industry. A good place to start with planning improvements would be to look retrospectively at other projects that you have completed and consider what could have gone better in terms of planning.