Edinburgh SMEs harnessing digital with plans to broaden horizons next year

About seven in ten small businesses in Edinburgh plan to expand nationally and/or internationally for the first time next year, according to new research from Google.

The internet giant has found that despite the challenges of the past 18 months, 28 per cent of those in the Scottish capital aiming such expansion plan to do so both nationally and internationally in 2022.

Looking at small and medium-sized enterprises (SME) in the city, with a survey of 250 such firms taking place between September 17 and 28, a third say their decision to grow nationally was driven by their increased uptake of digital tools following lockdown, while 30 per cent attribute this to opportunities created by online platforms. In addition, 29 per cent say opportunities created by social media played a role in their decision.

The report comes after the Scottish capital was recently found to be one of the top two UK cities outside London to start a business.

More than four in five smaller firms surveyed in the Scottish capital will take on more staff next year, Google has found. Picture: Ian Georgeson.

Of the 81 per cent of firms in Edinburgh who received government funding in the past year, 22 per cent used this to invest in new physical premises while 18 per cent shelled out for new digital software and hardware, such as laptops. A fifth used this funding to hire staff.

The research also reveals how more than four in five SMEs in Edinburgh surveyed will hire more next year, and, despite increased use of digital over the pandemic, only 21 per cent of those with a physical presence intend to scale it back.

The findings come as Google unveiled its independent Economic Impact Report for Edinburgh, published by independent research specialist Public First, quantifying its impact on the local economy.

The study found that as a result of the pandemic, more than 2,400 Edinburgh businesses started selling online for the first time, at least 2,100 started taking online payments for the first time, and in excess of 1,700 made their online advertising debut.

Edinburgh-based fishmonger Fresh Fish Daily, for example, says it had no online presence before the outbreak of Covid-19. After having to close its high-street shop during lockdowns, the business started using Google tools to help find new customers across the whole of the UK – with sales increasing by 1,328 per cent in one year alone.

Founder George Baxter said: “We’ve put more focus on encouraging customers to add online reviews so that potential customers can get a sense of what to expect.”

Next phase

Ronan Harris, vice president and MD (UK and Ireland) at Google, said: “With more small businesses across Edinburgh on the brink of expansion, we must make sure that everyone has the digital tools and skills needed for the next phase of business growth.

"It’s inspiring to see people gain confidence through our Google Digital Garage skills training. Encouraging greater adoption of digital technology could be one of the most powerful ways of driving a sustainable and inclusive recovery.”

However, Google cited SME-owners and decision-makers in Edinburgh seeing the most common barriers to growth as potential future Covid-19 restrictions (27 per cent), staff shortages (26 per cent) and supply chain issues (24 per cent).

When asked what advice they would most like to receive about growing their business using digital in 2022, SME-owners cited online advertising (13 per cent) and e-marketing (12 per cent).

A message from the Editor:

Thank you for reading this article. We're more reliant on your support than ever as the shift in consumer habits brought about by coronavirus impacts our advertisers.

If you haven't already, please consider supporting our trusted, fact-checked journalism by taking out a digital subscription.