The latest Index from Kensington showed that 67 per cent of self-employed people are confident about their business prospects for the next six months, up from 64 per cent last quarter, with more than half of business owners (52 per cent) aged between 35 and 44 expecting their turnover to increase in the next year.
But the rising rate environment is having an effect on how the self-employed run their business, with more people looking to control their overheads and expecting to have to increase their marketing spend in order to maintain turnover.
Nearly three quarters (74 per cent) of business owners say they do not plan to recruit more staff over the next 12 months, up from 68 per cent last quarter. While a quarter (25 per cent) say they will definitely not be investing in their business for new materials, equipment, vehicles or training in the next year – up from one fifth (20 per cent) last quarter. And 13 per cent of business owners say they will definitely have to increase their marketing activity to maintain their previous year’s turnover, up from 10 per cent last quarter.
When it comes to investing extra financial resource into their business, nearly half of business owners plan to dig into their own resources, with 46 per cent using personal savings, up from 40 per cent last quarter.
By far the most confident age bracket is those business owners aged between 35 and 44, with 34 per cent claiming to be ‘very confident’ about their firm’s business prospects for the next six months. While it seems that female business owners are slightly more bullish about turnover than their male counterparts, with 46 per cent of self-employed women expecting it to increase compared to 43 per cent of men.
Ian Giles, director of marketing at Kensington Mortgages, said: “The Kensington Self-Employed Index has already shown how bullish Britain’s business owners are about their prospects, and this latest batch of research shows that they have the shrewdness to justify that confidence. No business is resistant to external influences and, when circumstances change, successful businesses are able to react to those circumstances and come back stronger than ever before.
“With rising rates, the cost of borrowing is increasing and so more business owners are turning to their own personal savings to invest in their future success. This can have a knock-on effect on their own finances and so there is a growing opportunity for intermediaries to help the self-employed adapt to the changing economic environment by providing sound financial advice.”
