Small and medium-sized businesses serve as the backbone of the UK economy, accounting for just over half of the UK's GDP. In fact, in 2008, there were 4.8m SMEs in the UK, providing 47% of the UK's private sector employment and 36% of turnover. It is no surprise then, that their contribution to the UK's current and future success is crucial. While 2009 will not doubt go down on record as a tough year for many businesses, recovery and success in 2010 will depend on the innovation and business acumen of SMEs around the country - not only to stabilise the UK economy but also to provide a valuable source of employment.

1 Small businesses will lead the charge out of the recession
The growth of the UK economy in 2010 will be greatly influenced by the success of UK entrepreneurs and small firms. The Federation for Small Businesses (FSB) recently claimed that 51%of SMEs intend to continue developing their company this year. In fact, in our 2009 research on the 'Essence of the Entrepreneur,' which surveyed entrepreneurs and the general UK workforce on what it takes to be a successful entrepreneur, nearly three quarters felt the economic climate of the past few years will see a new breed of entrepreneur rising up from the ashes. The strength and energy that SMEs offer to society and the economy as a whole will help drive the nation on its road to recovery in 2010.

2. SMEs will have the freedom to work where suits them best
For a lot of us, our ultimate dream is a life away from the hustle and bustle of the city in exchange for a more rural setting. Our Value of Connectivity report showed that the South West of England could see a population increase of more than 150% by 2015. This will be a result of universal access to reliable and fast fixed and mobile broadband - as outlined in the Government's Digital Britain report - which will allow more people the flexibility to live and work in a place of their choosing.

However, while for many of us this is only a dream, the flexibility of SMEs makes them natural candidates to work from home or access their offices remotely. As economic pressures stay high in 2010 and cost savings remain a priority, being able to work from home and save on rent will be a big advantage to smaller businesses. The ever increasing sophistication of mobile technology such as smartphones and mobile broadband, has also made it easier for businesses to tap into all the resources they need, no matter where their location.

Small firms will have to focus their energies on nurturing online advocates for their products and brand
3. SMEs will have increased support from Governments and industry
Following the Government's announcement that it intends to cut regulation costs over the next five years, 2010 is likely to see a continuing reduction in red tape for SMEs. This move will no doubt be welcomed by the small business community who regularly tackle tight cash flows to ensure wages and their own suppliers are paid, and to keep their credit rating strong. This move should herald new business efficiencies over the coming twelve months.

4. Small firms will have to strive for customer loyalty online

In 2010, small firms will have to focus their energies on nurturing online advocates for their products and brand. As customers continue to seek the best deal and supplier loyalty remains low, SMEs can't afford not to engage with their customer base online. With the phenomenal growth of social networking sites such Twitter, LinkedIn and other online communities, companies have an open global forum to compliment their brands and products as well as interact directly with customers. Learning from the success stories of other larger organisations, SMBs will embrace social networking even more throughout 2010 as a way of building online customer advocates in a cost effective way.

5. SMEs will use mobile technology to make their working lives simpler
Time-saving technologies, such as mobile banking, hold the potential to greatly reduce SMB's administrative chores. As businesses increasingly use their mobiles like a mini-office, they will also undertake traditionally arduous tasks, like paying bills, from their mobiles. Advanced security functionalities make it quick and safe for SMEs to check invoices and pay suppliers directly from their phones, eliminating the risk of incurring charges from unseen bills.

Conclusion
As we look towards 2010, there are both opportunities and challenges on the horizon - for instance the general election, increased competition from abroad and a fragile economy. However with grit and determination, the UK will no doubt continue to be a strong breeding ground for budding entrepreneurs as we head into 2010 and beyond.

For more information please visit www.business.orange.co.uk