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Confidence among small businesses in the South West has taken a surprise downward turn, according to our latest quarterly survey.
FSB survey its members about their future plans every quarter via our Small Business Index (SBI) and the results of its latest poll, released on June 27, shows that while the rest of the country is seeing rising confidence, the South West has bucked the trend and has recorded the lowest levels of confidence in the UK.
The latest figures show that almost a third (29%) of small businesses in the South West expect their performance will improve over the coming three months but 32% believe their performance will worsen. In contrast, nationally 35% of small businesses expect their performance will improve over the coming three months while just 24% believe performance will worsen.
However, it is not all bad news for the region.
The proportion of South West small firms saying that gross profits are steady or increasing is at 56% and growth intentions look promising in the region. The vast majority of small firms (88%) plan to remain the same size or expand in the coming 12 months and over three quarters (76%) also report steady or increasing headcounts.
Ken Simpson, the Area Lead for the FSB in the West of England, (pictured here) said the fall in confidence in the South West shows that the area’s usual positive influence on the national economy should not be taken for granted.
“As ever, our report reflects a lot of very good activity among our SMEs in the South West but none of us want to see this region at the bottom of the league table when it comes to business confidence.
“Perhaps the ongoing uncertainty over Brexit other issues affecting the day to day life of our SMEs is now starting to takes its toll on confidence in the South West and we must hope to see a quick reversal in this result. It is definitely a concern.”
Elsewhere in the survey in another reversal of a previous trends, female small business owners are now more confident than their male counterparts.
FSB National Chairman Mike Cherry said: “Many women in business still face an uphill struggle, not least when it comes to securing investment. Visibility of role models is one issue, and we’re working hard to address that challenge. On the other hand, thousands of women in business are going from strength to strength. It’s good to see that reflected in today’s report.”
In a worrying point in the survey, confidence among retailers across the UK is now in negative territory and Mr Cherry says this highlights that SMEs in the retail market need urgent support.
“Retailers are well and truly under the cosh as they try to absorb rising business rates, wages and pension costs. Our high street shops need more support when trying to absorb these expenses. An increase in the Employment Allowance to £4,000 is overdue. We also need to rebalance the taxation system. As things stand, you have rates going up while corporation tax is coming down. If we want to breathe life back into our high streets, that needs a rethink,” said the FSB chairman.
Read the Q2 Small business index here
National Federation of Self Employed & Small Businesses LimitedSir Frank Whittle Way / Blackpool / FY4 2FE. National Federation of Self Employed & Small Businesses Limited (FSB) is registered in England, number 1263540