UK SMEs Feeling the Pinch of Worldwide Trade Turmoil
New data from Bibby Financial Services (BFS) shows that the rising tide of U.S. tariffs is putting serious strain on small and medium‑sized firms across the United Kingdom.
The Toll on Trade
- More than half (55%) of the 500+ UK SMEs surveyed point to tariffs as their biggest current headache – a jump of 15 pts from last year.
- Nearly half (47%) predict a dip in overseas sales by year‑end, climbing to 51% for those with the U.S. as their top export destination.
What the Numbers Mean
BFS’s “Trading Places” report estimates that the average business will pay roughly £17,000 in new levy fees. Add that to the already‑heavy load of rising interest rates and stubborn inflation, and the picture looks bleak. The Confederation of British Industry says this marks the weakest outlook for the private sector since 2022.
Re‑thinking Relationships
- 20% of SMEs are cutting back their U.S. customer roster.
- Nearly 60% are shifting currency payments to euros or sterling to dodge dollar swings.
- There’s a growing trend toward “friendshoring” – partnering with nations that share political or free‑trade ties.
Charting a New Course
In the next 12 months, 64% of firms plan to chase fresh trading partners, a 10‑point rise from 2024. A similar 36% are expanding existing ties to shield themselves from policy jitters.
China is leading the pack as the next favourite export destination at 13%, more than doubling the 7% figure from last year. Yet more than half (56%) feel Brexit has hit their global competitiveness, with 66% expressing a wish to stay in the EU if they could vote again.
CEO’s Take
Jonathan Andrew, global boss at BFS, sums it up: “The worldwide trade map is being rewritten. Businesses that get ahead on tariff and currency risk will thrive in 2025 and beyond.”
“It’s more important than ever for SMEs to stay ahead of the curve. That means assessing how tariff deals influence operations and actively managing currency exposure.” – Jonathan Andrew
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