The findings, from the firm’s latest commercial broker survey, point to a growing wave of ownership transitions among UK SMEs as older owners prepare to exit their businesses.
Just under half of brokers (46%) said business owners are selling to cash out and realise the value they have built. One in five (20%) said exits are being driven by rising costs, including increases to employer National Insurance contributions, wages and other business expenses. Only 9% of brokers cited concerns over employment law or regulatory changes as influencing sales.
The survey, which also explored funding demand, lender appetite and in-demand sectors, provides a snapshot of current trends in commercial finance.
Gary Thompson, sales director at Asset Advantage, said:
“While it may be easy to draw conclusions from the current economic or political climate, our data suggests that retirement still remains the primary motive for business owners to sell. As these experienced owners look to depart and hand over the baton, it will reshape the ownership landscape within UK SMEs and drive demand for both specialist advice and flexible funding. To facilitate these deals, funders have to be present and proactive, with an appetite for growth and expansion-based lending and importantly, an open-minded approach.
“In some cases, higher costs may be accelerating exit decisions by older business owners and something we may see increase based on the outcome of the upcoming Budget. For others though, it’s less about retirement and more about timing – deciding now is the moment to realise the value they’ve created. Whether it’s driven by business owners or by their existing management teams, our data tells us that there is real demand for business acquisition funding, which is likely to be a consistent theme over the coming years.”
