While only 7 per cent of the 1,350 UK businesses surveyed by business software company Sage believe it is easier for SMEs to compete with their more established counterparts, the study identifies clear areas where smaller companies can steal a march on larger rivals.

Of those companies that believe it is now easier for smaller businesses to compete with larger ones, two fifths (41 per cent) see the rise of social media as a simple and cost-effective marketing tool as the biggest enabler.

Some 18 per cent perceive the agility and adaptability of small businesses works in their favour, while 15 per cent believe that the more personal service that small businesses can deliver make them more attractive to consumers.

The dominant belief among the UK business community is that big businesses continue to have the edge, but encouragingly for SMEs almost half (45 per cent) believe small businesses are catching up, while one in ten (10 per cent) believing it’s now a level playing field.

UK respondents are bullish about their own prospects with two thirds (65 per cent) saying they feel confident about competing with businesses bigger than their own.

Brendan Flattery, CEO of Sage UK and Ireland says, ‘Big business may still have the edge in the current marketplace, but the tide is turning thanks to social media and the delivery of a personal customer service.

‘It’s crucial that SMEs and entrepreneurs are given the tools they need to thrive and feel empowered to compete with companies bigger and more established than themselves.’