FSB report finds reasons for South West to be positive despite SME confidence dip

By Nick Batten on 18 November, 2020

The latest quarterly report from the Federation of Small Businesses (FSB) – has revealed that while confidence amongst small businesses in the South West has continued to fall – there are some glimmers of positivity for the future.

The Q3 2020 Small Business Index found that despite extremely difficult trading conditions in the South West, businesses polled were among the most positive in the country. When looking at their future revenue projections, fully 40 percent of them expect to grow rapidly in the next 12 months.

In another positive finding, although 18 percent of SMEs in the report said they had decreased staff numbers in the South West, a perhaps surprising 15 percent had actually increased their numbers. As a result, the South West had the slowest rate of overall SME employment decline of those polled in the English regions.

Despite these seeds of optimism, however, the figures – based on the third quarter July-September – show that confidence as a whole is still falling among SMEs in both the South West and nationally.

Summarising the findings, the FSB’s South West Regional Chairman Lee Nathan said there are still areas of major concern despite the resilience and hard work of the region’s small business owners.

He explained, “The report shows small firms in the region continue to be adversely affected by the pandemic and national lockdown, particularly in relation to general business conditions and employment intentions. However, stoicism remains in place with investment intentions expected for many in the next 12 months, with the South West showing as positive in comparison to the rest of England.

“It is crucial that our regional businesses are given confidence and certainty at this time, particularly for businesses most in need of support in the hospitality, retail and tourism related sectors; and not forgetting those working in the supply chains. A lot of small businesses have shelled out thousands to make their premises safe at a time when they had little or no revenue coming in only to be told to close. Securing a swift and positive EU deal will provide a fillip for many small businesses at what has been an extremely difficult time”.

The South West findings were part of an overall national FSB report which said that business confidence had now been in negative territory for two years.

FSB National Chairman, Mike Cherry said, “Too many small businesses are still without the help they need to weather current disruption – not least company directors, the newly self-employed, those without premises and those further down supply chains in the retail, leisure and hospitality sectors. An ambitious rescue package for these groups is urgently needed. Local authorities should also use their new discretionary funds being allocated to assist them wherever possible.”

The full report is due to be published soon.

Pictured above: FSB’s South West Regional Chairman Lee Nathan