Almost two-thirds of small and medium-sized enterprises (SMEs) in Scotland expect turnover to grow over the next three months, according to new research from Uswitch.
The survey of SME leaders, published this week, found that 63% anticipate either moderate or significant growth in the near term, with just 11% predicting a decline in turnover. A further 26% expect no change.
Despite an uncertain economic backdrop, Scottish SMEs appear to be showing resilience compared with many larger businesses, which have reported weaker sales and reduced confidence in recent quarters. Across the SME sample, the two main drivers of optimism were increased consumer demand (32%) and recent strong business performance (30%).
However, the findings also reveal clear generational divides. Younger entrepreneurs are considerably more confident, with 80% of 18–34-year-olds expecting growth, compared with just 47% of business owners aged 55 and above. Nearly a quarter of the older cohort (24%) expect turnover to fall, citing rising operational costs (47%) and inflation and weaker consumer spending (35%) as their primary concerns.
The appetite for finance reflects this divergence. While 58% of SMEs overall plan to seek external funding in the next three months, the proportion rises sharply among younger business leaders. By contrast, 41% of over-55s said they were unlikely to pursue outside finance, and none expected significant turnover growth in the short term.
Andy Elder, business savings expert at Uswitch, said: “You can see two very different instincts in the data. On one hand, younger founders are ready to back their plans with finance and scale quickly; on the other, more established owners are tightening their finances and managing costs.
“If you run a small business today, the practical takeaway is simple: know where you sit. If demand is returning for you, make a plan to fund and protect growth. If costs are the problem, focus on pricing, efficiency and the areas where you can control spend.”
The research underlines the continued importance of SMEs to Scotland’s economy. SMEs account for more than 99% of private sector enterprises and employ over 1.2 million people across the country. Policymakers and lenders will be watching closely to see whether this renewed optimism translates into sustained investment and job creation, particularly as inflation remains above the Bank of England’s 2% target and borrowing costs continue to weigh on businesses.
