Small business sentiment improving – SFA survey

Small business sentiment improving – SFA survey
Pictured: Avine McNally

In the Spring Business Sentiment Survey from the Small Firms Association (SFA), 30pc of respondents rate the current overall business environment as ‘poor’ or ‘very poor’, a drop of 20pc when compared to 12 months ago.  Some 23pc of respondent companies rate the overall business environment to be either ‘very good’ or ‘good’.

Nearly four in ten companies (39pc) rate their own business currently as ‘very good’ or ‘good’.  While 20pc rate it currently as ‘poor’ or ‘very poor’, this is a drop of 13pc on this time last year.

“Business confidence levels for the first quarter of 2013 have improved compared to this time last year,” said SFA director, Avine McNally.  “While domestic sales remain slow, there are increasing signs of stabilisation and business activity shows positive increases in the coming months.

“Improvement in small business sentiment and business activity levels are also encouraging and indicate that a gradual recovery is taking hold.  Over a quarter of small firms indicate they were ‘more confident’ about their own business than they were three months ago.

“Government needs to ensure that they assist small firms build on this positive sentiment by creating a business environment conducive to small business survival and growth.”

The business activity indicators show that expected changes over the next three months are more positive than previously experienced, with 31pc expecting profitability to increase slightly; 35pc expecting domestic market sales to increase and nearly half of those companies who export expect to see increase in sales; and 41pc expecting an increase in their customer base.

“The biggest challenge for small firms, especially those trading on the domestic market, is confidence among consumer.  While there is a gradual improvement it remains fragile, as many positive signs have been knocked by concerns over the eurozone and higher taxes,” said McNally.

She stressed the need to build upon confidence within the small business sector and called on the Government to “put in place policies that will assist this vital sector drive growth in the wider economy”.

The SFA has put forward the following three point plan: Make SMEs and job creation the leit motif of Government policy; increase credit availability to SMEs and financing facilities to support expansion and improve cashflow; no additional costs on employment in 2013.