NEARLY 70 per cent of small and medium-sized businesses in Scotland plan to expand organically over the next few years, in spite of “deep uncertainty” over Brexit, a survey shows.

Accountancy firm Johnston Carmichael’s survey shows 47 per cent of Scotland’s small and medium-sized enterprises (SMEs) view Brexit as a key concern for their business over the next couple of years. Brexit was the biggest concern among firms.

A smaller but still significant proportion, 43 per cent, describe the prospect of a second Scottish independence referendum as a main concern, the survey shows.

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Johnston Carmichael calculates the survey’s finding that more than 69 per cent of Scotland’s SMEs have ambitions to grow organically in the short to medium term suggests that in excess of 226,000 businesses across the country believe they can achieve growth.

This is based on applying the percentage of those surveyed who declared organic growth ambitions to Scotland’s total SME population of about 326,000, based on figures from the Department of Business, Innovation and Skills.

The research “confirmed deep uncertainty among Scotland’s SMEs about the impact of Brexit”, Johnston Carmichael noted.

Andrew Ewing, partner and head of corporate finance at Johnston Carmichael, said: “It’s great to see that confidence remains high in Scotland despite the uncertainty associated with Brexit and the potential of a second independence referendum.”

He added: “At the moment, we simply don’t know what Brexit will mean in terms of free trade and the movement of people within Europe, but it appears that business owners have decided to carry on regardless until such time as there is more clarity on these issues.

“As always, SMEs need to be proactive rather than reactive, and through planning ahead, whether for sale, fundraising or acquisitions, they can remove some of the uncertainty.”

Slightly more than 10 per cent of Scottish SME decision-makers said they would target growth through acquisition, and nearly 13 per cent were planning to sell their business.

Of SMEs surveyed, 15 per cent cited finding staff as a significant barrier to growth.

The survey of more than 300 SME decision-makers in Scotland - half of them business owners – signals 65 per cent expect to fund growth plans with cash generated by the business. Only 12 per cent said they would seek bank debt to fund their growth. And 10 per cent identified private equity investors as possible funding sources.

Separately, the Scottish Council for Development and Industry yesterday highlighted its belief that challenges around weak productivity and the relatively small number of companies accounting for most of the country’s exports must be addressed to strengthen economic performance north of the Border “in an unprecedented period of change”.

SCDI said: “The First Minister’s announcement that she is proposing a second referendum on Scottish independence, and the agreement of the UK Parliament that the Prime Minister can trigger Article 50 for the UK to leave the EU, create uncertainty around the operating environment for business in the coming period.”

Michael Urquhart, who chairs SCDI’s international business committee, said: “Brexit will fundamentally change our trading relationships with the EU and the rest of the world.”