Federation of Small Businesses

SME confidence bounces back

Confidence among UK SMEs has recovered amid lower inflation, according to a new study.

The latest Federation of Small Businesses (FSB) small business index (SBI) revealed that a third of firms (32%) have said that they expect their performance to improve over the next three months.

Only one in four UK businesses (27%) expressed a lack of confidence about the upcoming quarter, while 40% expected their performance to remain the same.

The quarterly small business index stood at +6 in Q1 2018, up from -2.5 in Q4 2017.

More than two thirds of firms (67%) reported that their revenues were either stable or increasing.

The proportion of firms planning to increase investment has risen to a third (33%), while half (50%) expected to expand operations over the next 12 months.

Mike Cherry, national chairman at FSB, said: “After a 2017 dogged by spiralling prices and political uncertainty, it’s good to see small business confidence back in the black.

“The resilience of the small firms and self-employed entrepreneurs that make up 99% of UK businesses has lifted economic forecasts for the coming 12 months. 

 “Positive commitments from the chancellor, along with agreement on a Brexit transition period and falling inflation, should make it easier for small business to plan, invest and grow in the months ahead.”

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