Europe’s mid-market could be missing out on £364bn annually
Regulation, talent and tech holding back Europe’s mid-sized business sector
Ricoh Europe, London, 12 September 2016 – European mid-sized businesses could be missing out on up to £4.8 million (€5.7 million) of annual revenues because of barriers that hinder their growth. With 75,000 mid-sized businesses across Europe, the total missed potential revenue could amount to up to £364 billion (€433 billion) – almost the same as the annual GDP of Poland. The data comes from new research commissioned by Ricoh Europe.
While this huge opportunity is being missed, Europe’s mid-market is aiming for significant growth. Almost 40 per cent of businesses are planning to offer shares to the public in initial public offerings in the near-future. Another 21 per cent plan to acquire other companies or merge with competitors to increase their competitive strength.
Despite being hugely ambitious, 93 per cent of mid-sized businesses report that they encounter barriers that prevent them from reaching their full potential. The top three obstacles to growth are the need to comply with complex and costly regulation, the struggle to attract the best talent and finding, buying and applying the right technological solutions.
“Mid-sized businesses in Europe face very similar challenges, regardless of their country and sectors. This includes major structural and behavioural challenges that must be addressed at the level of the individual business, as well as in terms of national business policies,” commented Jyoti Banerjee, co-founder, M-Institute – the think-tank representing medium-sized businesses. “We should be celebrating the accomplishments of mid-sized businesses all over Europe. They are growing and creating jobs. But we must also recognise that more support from government and industry would make a huge difference to how this amazing, but often overlooked, group of companies perform.”
According to the research, 30 per cent of mid-sized businesses have yet to apply digital solutions that would enable them to scale up and become big brands – critical to capturing some of the revenue they miss out on each year.
“Most government support is focused on small businesses, while large enterprises are typically able to look after themselves due to their scale. Mid-sized companies often feel like they are the neglected child of the European business world,” said David Mills, CEO of Ricoh Europe. “£349 billion is a staggering amount of capital for mid-sized businesses, and the European economy as a whole, to be missing out on. Digital solutions like e-invoicing and office automation support growth by making cash flow management and processes like invoicing and communicating with customers cheaper and more effective. We believe it is time for the mid-market to prioritise innovation and make sure its businesses are truly adaptable. The easiest way to do this is by streamlining processes that make it possible to overcome the range of challenges they are facing.”
Find out more at www.ricoh-europe.com/thoughtleadership.
Note: Definition used for this research of a mid-sized business is a business with between 50-500 employees and revenue between £2.5million and £100million.
 Exchange rate: 1.00GBP = 1.19EUR, xe.com, 3rd August 2016
 Figure for number of mid-sized businesses in Europe provided by M-Institute, July 2016
 Total potential missed revenue = average. perceived missed revenue multiplied by number of mid-sized businesses across Europe (£363.6bn = £4,848,876m x 75,000)
 World Economic Outlook Database April 2016, International Monetary Fund – GDP Poland, $474.893bn 2015