By Daniel Hunter
According to new research commissioned by energy supplier npower, the majority (57%) of the UK’s small and medium-sized businesses (SMEs) are only planning between six and 12 months ahead. Most of this is due to the uncertain economic climate and income holding them back from making future plans.
Despite this, 55% of small to medium-sized enterprises (SMEs) wish they could plan further in advance, recognising the benefits of longer-term business planning.
When asked about how they manage their energy use, nearly 60% (56%) of SMEs said they take a planned approach to their businesses’ energy consumption. However, a quarter (25%) of businesses still do not implement any form of energy efficiency measures, which means they could be missing out on opportunities to plan and save.
More than 500 SMEs across the UK were questioned in the research, carried out in December 2012, which looked at attitudes to business and energy planning.
For a significant percentage of SMEs (42%), the day-to-day running of a business is preventing long-term plans being made, stating that more time and resources would help make planning easier. However, 60% of small companies say being able to fix prices, such as their energy supply and other overheads would also help them to plan further ahead.
“We commissioned this research to better understand the challenges SMEs are facing when it comes to planning for their businesses’ future," Phil Scholes, SME markets director at npower, commented.
“It is encouraging to see many SMEs wish they could plan further ahead. While the stability of the economy, which many SMEs cite as a key barrier to forward planning, is not something businesses can control, there are some steps they can take to help. For example, businesses may look to fix the cost of overheads where they can, such as choosing a fixed energy tariff, to help provide the certainty and confidence to plan ahead.”
While the research highlights many SMEs are not planning for the future, there are some which are taking steps to keep costs in check, making planning for the long-term success of the business easier. Nearly half (41%) of SMEs questioned see energy efficiency as a key business priority, while a significant number (43%) have examined the energy marketplace and switched energy suppliers at least twice.
“The energy picture formed by the SMEs’ responses demonstrates that, while some companies have embraced a strategy to minimise energy cost risk, as well as undertaking measures to reduce energy consumption levels and cost, many others are still not taking advantage of the solutions on offer," Scholes continued.
"Addressing energy costs by switching suppliers, fixing price and embracing energy efficiency, will improve the bottom line and help small businesses plan confidently for the future.”
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