Marked turnaround in optimism among the region’s small business as lockdown eases

April 28, 2021

Small business confidence has staged a dramatic recovery in the South West, according to the results of a new survey, as firms look head to life after lockdown.

The latest quarterly survey by the Federation of Small Businesses (FSB), conducted among its members last month, reveals levels of optimism not seen for nearly seven years. 

Confidence levels for firms in the South West shot up from minus-39% in the last survey results at the end of 2020 to plus-40 point this time – giving the region a far healthier outlook than the UK average, according to its small firms.

The survey results also show that more than half of small firms in the South West expect their revenues to rise in the next quarter while one in three plan to increase investment.

Just under half said their growth aspirations for the next 12 months are to grow either moderately or rapidly.

Welcoming the figures, FSB regional chairman Lee Nathan, the director of a creative agency operating in Bristol and Devon, pictured, said he hoped that the surge in confidence would encourage businesses to start believing again after a very difficult 12 months.

“Confidence levels are as high as they had been since the end of 2014 and that is something we really should applaud because when businesses start feeling more confident then actual business starts to happen again – and that can only be good for all of us,” he said. 

However, the survey results also revealed a number of concerns, with one-in-ten owners intending to downsize, sell or close their business in the next year – although this was half the percentage in the previous survey.

Meanwhile, firms identified several barriers to growth over the next 12 months, including  lack of consumer demand, finding skilled staff and general post-Covid trading conditions.

Mr Nathan stressed that, despite the boost in confidence, the situation for many small firms would remain tough.

“There are still many businesses that are extremely worried about whether they will be in a financial position to continue once the lockdown ends and we should never underestimate the pain and anguish many are going through,” he said.

“Just because the Covid pain is easing it doesn’t mean that the problems for small businesses or their finances will come to an end as well.”

The FSB surveyed 1,684 small firms across the UK between March 8 and 22 on a range of economic indicators including their confidence levels, employment and wages, exports, productivity, spare capacity, finance and investment.


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