This report examines the evolving artificial intelligence (AI) skills needs of small and medium-sized enterprises (SMEs) in the United Kingdom, with a particular focus on the Surrey business landscape. Drawing on desk research across academic literature, policy reports, industry evidence and existing AI skills initiatives, it identifies key opportunities, challenges and gaps in AI adoption and workforce capability development among SMEs. The findings highlight the need for accessible, practical and sector-relevant AI skills support that responds to differing levels of organisational AI readiness. The report also considers barriers to engagement, including limited time, uncertainty about appropriate AI applications and difficulties navigating existing training provision. It provides an evidence base to inform the design and delivery of future AI skills development initiatives for SMEs in Surrey and beyond.