The optimism is real. So are the costs.
Allica Bank surveyed 500 established UK SMEs in late 2025. The headline: 90% are planning to invest in growth this year. Of those, 56% have active plans already in place, 34% are still working on them. Just 2% are scaling back.
That's impressive, given the backdrop. The ONS reported on 22 January that only 16% of trading businesses expect turnover growth in February 2026, while 20% anticipate declines. And from April, electricity network charges will rise over 60% year-on-year, adding 5-10% to total business electricity costs.
What growth looks like
When SMEs say "growth", they mean:
- 64% plan to hire more staff
- 60% will develop new products or services
- 40% plan to invest in new technology or software
- 29% will spend on marketing and advertising
Other plans include staff training, expanding premises, and purchasing equipment or vehicles.
The funding gap widens
Here's the shift: 60% of respondents say they'll seek external investment in 2026, up from 40% previously. That's a 50% increase in businesses needing capital to fund expansion.
Meanwhile, only 3% of SMEs cite access to finance as a barrier. The real challenges are rising costs (29%) and demand uncertainty (25%).
What this means for advisers
CFOs and accountants need to:
Pressure-test cashflow forecasts. Growth plans plus rising energy costs plus wage inflation (£12.21 living wage from April 2025) equals tight margins. Model it.
Know the funding landscape. Start-Up Loans now go to £25k at 6% fixed. Growth Guarantee Scheme extended. EMI reforms eased. Clients need options, not just bank debt.
Flag the timing risk. 2025 saw record insolvencies. Base rates at 3.75%. Expansion during cost spikes requires capital buffers, not optimism.
The ambition is there. The question is whether the balance sheet can carry it.