As we move into 2023 it’s the ideal time to look at what we can expect in the UK SMEs world over the next 12 months. Here are three trends I believe SMEs should watch out for in 2023.

Recruitment goes global

The continued skills shortage across most industries in the UK will see many businesses looking at talent overseas. The UK’s businesses are doing comparatively well in tapping into overseas talent and shown more willingness to utilise international workers than the US or Canada. Research from Remote found 30% of London entrepreneurs have the majority of their team based in another country, while 56% of business owners across the UK have hired at least one international employee since 2020.

Also, only 19% of UK business owners said they had no intention of hiring any international staff, compared with 37% in the US and 21% in Canada. The increase of remote working has facilitated businesses hiring international staff and businesses have realised the benefits: 88% of UK employers said hybrid or remote working has positively impacted their company culture.

However, how does it work if you don’t all speak the same language? A key part in the success of this recruitment will be finding the right solutions to overcome language barriers, whether that’s digital translation devices such as Pocketalk which offer instant, accurate two-way communication, for informal phone or face-to-face chats, or subtitles for video conference calls.

Technological innovation will speed up to combat rising costs 

As well as hitting consumers hard, the cost-of-living crisis has also had a big impact on businesses, particularly SMEs who may not have as much financial cushioning as other big players.

On top of facing rising energy prices and higher wages, there is a 25% corporate tax increase set to take effect in April 2023. This means businesses will be looking for ways to reduce their spending, which is likely to see accelerated digital transformation. 

SMEs should invest in innovations and developments in transformative technologies such as AI, IoT, virtual and augmented reality, and cloud computing. Also, there will be a greater combination of these technologies working together than ever before. New solutions for hybrid and remote working, business decision-making, and automation of manual, routine, and creative workloads combine these technologies in ways that enable them to enhance each other. 

To prepare for this, SMEs must ensure they invest in the right technology throughout their processes and in every area of operations. The right solutions can save organisations thousands of pounds as well as increase productivity, improve customer services and stimulate innovation. All of which will add to the profits of the company and help level up against increasing costs. 

New long-term supply chain model

Global supply chains are under strain due to the ongoing impact of the pandemic and Russia-Ukraine war. At the same time, the UK is still dealing with the legacy of Brexit and the impact it has had on supply chains for importing and exporting goods, services and raw materials.

This means that as issues with supply chains continue UK SMEs will increasingly look to diversify their supply chain and look to emerging markets.

According to new analysis from Morgan Stanley Research, a new supply chain model is emerging which is more focused on trade among regional players and allies. Although the full effects of this change will take years to emerge, countries like Mexico, India, Vietnam, and Turkey could benefit from the process. 

The numerous benefits of supply chain diversification include lowering costs and improving networks. But communication and cultural barriers can have a big impact if you’re moving to a new supplier. This means UK SMEs need to be more mindful than ever of cultural differences, regional business etiquette and effective language translation solutions for businesses, like those offered by Pocketalk.