Among those with growth ambitions, 34% anticipate expanding by around 25%, which could inject over £40 billion into the economy at a critical time. The survey, conducted in late July, also revealed that nearly half (45%) of respondents are considering seeking investment to support their growth plans.

While only 16% of small businesses are currently exporting, this figure has risen by two percentage points from the previous year. Notably, businesses founded by men (20%) are almost twice as likely to export as those established by women (13%). Among those not yet exporting, 20% expressed a desire to do so, and 10% of existing exporters aim to increase their international sales.

The report also examined digital adoption, finding that nearly half (44%) of businesses now consider themselves 'digital', a slight increase from last year. However, despite a shift towards digitalisation, 29% admitted to purchasing technology they don’t have time to utilise – this figure rises to 41% in Scotland.

While 50% of businesses have accessed support online, 34% reported difficulties in finding suitable business support.

Looking ahead, small businesses identified ongoing cost pressures on consumers (42%) and late payments (23%) as key challenges. A majority (60%) also voiced concerns over the current tax burden, warning that any tax increases in the upcoming Autumn Budget could negatively affect both confidence and profitability.

Emma Jones, CBE, founder and CEO of Enterprise Nation, said: “It’s refreshing to see confidence return after the recessionary pressures of 12 months ago, followed by the unavoidable political turbulence caused by the General Election.

“Entrepreneurs are often at their strongest in the face of adversity, so after putting growth plans on hold during an extremely difficult set of challenges, they can finally see the light at the end of a very long tunnel.

“One key finding is that while small businesses are embracing digital tools, they still need support to take their skills to the next level and help them use their technology more efficiently – but more than a third can’t get access to the support they need.

“Small businesses will play an important role as we reboot the economy, as we’ve demonstrated here with a modest upturn. So it’s more important than ever to create clear and easy routes to help them find the support they need to grow.”

A significant number of entrepreneurs – 20% – continue to grapple with the challenge of securing the space they need to operate their businesses effectively, whether it's business units, co-working spaces, or high street pop-ups. This issue is particularly pronounced in Scotland, where 29% of entrepreneurs reported difficulties, followed by 25% in the North West and 23% in the West Midlands. The problem has persisted for the past two years without any improvement, according to the analysis.

Although 44% of businesses overall identified as digital, a noticeable gender gap remains. Only 37% of female-led businesses described themselves as digital, compared to 52% of male-led businesses. Interestingly, while fewer women have embraced digitalisation, they are also less likely to invest in technology they don’t use. Only 26% of women reported purchasing technology they didn’t have time to utilise, compared to 33% of men, indicating that female entrepreneurs may be adopting a more cautious approach to tech investment.