20th January 2017

Predictions for 2017 – a small business blog

As a 42 year old, it feels like we have been in a recession forever. I say this, not as a moaner, but as a mover. When times are good for too long, we become complacent, slow down a bit and quite frankly lose a little ‘mojo’. Over 99% of UK businesses are small and medium sized (SMEs) and, together, we provide over 60% of private sector employment in the UK.

In all economic conditions there is always opportunity – it’s simply a question of how quickly we can adapt and move.

Here are my predictions for 2017 – by way of qualification – my three predictions for 2016 were Boris as UK Prime Minister, Trump as the US President, and Brexit. Two out of three ain’t bad.

  1. Gas and electricity prices for SME renewals will increase by at least 10%. Wholesale energy prices have been rising steadily for many months now and transmission costs only ever appear to increase. This makes switching important to minimise or eradicate the increase from your current supplier renewal.
  2. Water deregulation in April 2017 will present an opportunity for SME savings. Lots of water companies are playing down the opportunity to save by switching suppliers because the margins are so small. Like in other parts of the energy industry, SMEs pay more supplier margin than domestic and large consumers, so it’s game on for switching.
  3. We will see Amazon take a chunk out of the online grocery shopping market. Where they have been ‘playing’ in 2016, this year I think that we will see significant progress in this area with busy people opting for “little and regular” online grocery deliveries.
  4. 2017 will see an increase in people buying British to reduce exposure to exchange rate risk and perhaps supported by an enhanced sense of Britishness amidst Brexit. Both B2B and B2C will favour local supply, provided that the potential premium doesn’t outweigh the exchange risk.
  5. The Government will increase support for SMEs in 2017; the autumn Statement 2016 pledged £400M to start-up businesses via the British Business Bank. Particularly favoured sectors are Fintech (finance technology), Digital and Life Sciences. R&D Tax Credits also remain a fair reward for investing in innovation, with start-up loans of upto £25,000 per Director available through the Start Up Loan Company.
  6. A shift in card payments; contactless card payments will exceed 50% of debit and credit cart transactions. Apple Pay, Android Pay and Barclaycard bPay will continue to gain pace.
  7. From a macroeconomic perspective, increasing inflation will lead to interest rate increases in Q4 2017. Whilst this is a scary prospect – is it any more difficult than the previous 5 years? Not really. One thing is for sure, as an independent Britain we need great businesses and exceptional entrepreneurs. This will be close to the top of the Government’s agenda.

If the previous year has taught us anything it’s not to take forecasters predictions for 2017 as read. What is for certain, is that whatever happens, small business owners should be poised and ready to capitalise upon the exciting opportunities that inevitably lie ahead.  

Anthony Mayall

Anthony has been in industry for 26 years and in the energy market for over 10 years. He loves to help customers to reduce their costs by getting them a better deal elsewhere.

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