Scotland’s small and medium-sized enterprises (SMEs) are ready to invest more than £7billion of their turnover over the next year amid growing confidence in economic recovery, a new report says.
New equipment, staff training and creating jobs are top of their shopping list, Clydesdale Bank adds.
Research by the bank found more than four out of five (86%) of Scottish SMEs plan to make a significant investment in their firms over the next year.
On average, Scottish SMEs are poised to invest around 9% of their turnover back into their businesses.
This would be worth around £7.3billion to the Scottish economy, based on figures compiled by the UK Government and Federation of Small Businesses figures.
SME’s are often called the “engine” behind UK economic growth due to them making up all but a fraction of the private sector in terms of the number of businesses and nearly 60% of jobs.
At the start of 2013, SMEs throughout Britain employed 14.4million people and had a combined turnover of £1.6trillion.
Clydesdale Bank says their investment plans are being driven by improving economic conditions, with 73% of Scots SMEs believing this will continue and provide a strong environment for their own growth prospects.
Scottish firms expect to grow by an average of around 12% over the next year – an increase worth £12.7billion, or nearly £39,000 each.
North-east SME’s are even more confident about their growth prospects, with 87% planning major investment amid predictions of a 13% increase in average turnover.
Clydesdale Bank says agricultural, manufacturing and construction businesses appear to be the most bullish throughout the country.
But barriers to growth still exist and SME’s cited access to new markets and a lack of available finance as factors holding them back.
Stephen Hepburn, head of the bank’s business and private banking centre in Aberdeen, said: “An increasing level of confidence is playing a critical role in fuelling the recovering economy.
“Our ongoing research indicates that as business optimism returns the SME segment in Scotland is actively preparing to change up a gear to take advantage.
“Compared to this time last year, we believe an increasing number of businesses are now preparing themselves for growth.”
He added: “The message we are hearing from the majority of Scottish SMEs is they feel there will be opportunities for them to grow in the year ahead, and we are ready to support those growth ambitions.
This new research comes as Clydesdale Bank launches Business Week, which will see more than 250 events staged across its business and private banking centre network, including sites in Aberdeen and Inverness, from tomorrow until Friday.