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The Top Challenges Facing UK SMEs in 2022

25th July 2022

Due to the lingering impact of the coronavirus pandemic, many SMEs (Small to Medium Enterprises) have had to change and adapt to stay open for their customers, such as businesses in the hospitality industry who introduced QR codes for ordering and started offering takeaway options. Key factors affecting SME businesses in 2022 are coronavirus restrictions, environmental and sustainability challenges as well as financial difficulties. 

The financial impact is arguably the most severe. Many SMEs relied on financial support from the government during the pandemic: according to the Office for National Statistics, by August 2021, the furlough scheme had supported 1.3 million businesses and 11.6 million jobs. Only 9% of UK workers feel enthused by their work, compared to 14% in Europe, down 5 percentage points prior to COVID, ranking the UK 33 out of 38 European countries: Gallups ‘State of Global Workforce. The impact of the furlough scheme has resulted in employees becoming disengaged and less eager to work. This is understandable as many workers were unemployed for two years. 

The impact from Brexit, Ukraine and COVID on the cost of living, fuel, food prices, inflation,employment and skills have all effected SMEs. surveyed over 1,000 UK SME owners and senior leaders across 20 sectors and found that 9% of the businesses said that financial challenges were the biggest concern. 21% have relied on financial support from the government during the pandemic and many are now in debt. 

Another factor that affects SMEs is environmental awareness. found that 39% of Business owners and leaders are passionate about making their business more sustainable, because “88% percent say their job is more fulfilling when they are provided opportunities to make a positive impact on social and environmental issues” (source) and “57% of consumers in the UK alone have said they are willing to pay for products that are environmentally friendly.”(source).Many clothing brands are using recycled plastic and other materials - Culthread is a small, sustainable, vegan clothing brand based in the UK that uses recycled plastic in order to make its products.

As well as the previous factors, the emergence of platforms such as TikTok and Instagram and the rise of influencer culture have changed how businesses advertise. In 2022, there is no way to have a successful business in the UK without a social media presence. Both of the small businesses mentioned have an Instagram and a Facebook account that is updated regularly, and an active TikTok account. An active and engaging social media presence is needed in order to create a tight-knit community of loyal customers who will grow your business further. For example, Harris Hounds created the “Dog owners of Plymouth” Facebook group, which has now developed into a community of seven-thousand like-minded people, because people want to be loyal to a brand and marketing helps this.

How You Can Face These Challenges:

Investing in your Marketing (whether it's time, monetary or both) will educate your customers about your products and services and investing in your team (through incentives, value and support) will go someway to counteracting these challenges and moving forward within your business.

Your team are there to deliver on your marketing promises. It is this customer experience that will create brand loyalty to gain and retain your customers, so they back to you for more and tell others how great you are. 

At Business Success HR and Marketing, we combine People and Marketing in our ‘One Force Strategy® . To discover more, contact our us for a complimentary Zoom call: 01752 220377 or email This email address is being protected from spambots. You need JavaScript enabled to view it.

Grants for Your Business

If you want to invest in your Marketing or business growth, look out for free grants available to you, such as the 'Meet The Expert' grant available to Devon businesses: and get your business services known for free by registering your details on the Plymouth Supplier Directory (open to all PL postcodes in Devon & Cornwall):  

Blog post written by Emily Harris 12th year Student at Coombe Dean School.

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