Partner Article

Small business confidence takes a tumble

The FSB has publish its ‘Voice of Small Business’ index, showing confidence among the country’s small firms has taken a tumble.

Challenging domestic conditions, access to finance and weak consumer demand are noted as main factors as confidence levels move from 5.8 points to -4.5 in the third quarter of the year; the fourth lowest score since the start of 2010.

The research suggests some resilience is still in the air, as half of the 2,600 respondents want to grow in the next 12 months.

In the third quarter 21.6% of respondents had applied for finance, and the number of refusals for finance increased to 42.4% from 40.6%.

More than 60% of respondents said finance is unaffordable, and here the FSB hopes a small business bank will address the problem.

John Walker, National Chairman, Federation of Small Businesses, said: “It isn’t surprising that confidence fell back into negative territory as the recession entered its third quarter as growth flat-lines.

“The message is clear though – businesses want to grow and invest but they need a helping hand to do so. It is frustrating that bank finance is still difficult to get. No matter what is said about demand, more than 40 per cent of applicants have been refused in each quarter this year. This has to change if growth aspirations are to be met.

This was posted in Bdaily's Members' News section by Tom Keighley .