6 May 2016 11:00
There may be trouble ahead but SMEs are confident
Two new surveys reveal that freelancers and owners of small businesses are optimistic about their own business prospects despite worries about a downturn.
The latest Quarterly SME trends survey from the CBI shows that trading conditions have stabilised after deteriorating in the previous quarter. Its poll of 441 firms reported that total new orders and new domestic orders edged up slightly in the three months to April, while export orders fell again.
However, optimism about demand for exports over the year ahead also rose for the second quarter, with SMEs expressing greater confidence than larger firms.
The CBI survey's key findings are:
- 23% of SME manufacturers said they were more optimistic, while 18% said they were less optimistic, giving a balance of +5%;
- 26% said their volume of output was up, and 25% said it was down, giving a balance of +1%. Companies expect output to increase in the next quarter (+17%);
- 30% said their domestic orders were up, while 24% said they were down, giving a balance of +5%. Firms expect a slight strengthening in orders growth next quarter (+7%);
- 17% said export orders rose over the past three months, 24% said they fell, leaving a balance of -8%.
Meanwhile, a new survey by the Association of Independent Professionals and the Self Employed (IPSE) shows that although confidence in the economy among freelancers has slipped, this pessimism has not extended to their own business prospects. It says 68% of UK freelancers are as confident or more confident in their business outlook for the year ahead than they were at this point last year.
Personal brand and reputation in the marketplace were cited as the most important factors for driving performance (57%), while Government attitude towards freelancing was listed as the most significant factor which negatively affected business performance (54%).
Chris Bryce, IPSE CEO, said:
"This survey shows that freelancers are resilient. Most remain confident in their business even as they are less sure about how the economy will shape up in the next 12 months. Because they work flexibly, freelancers are in many ways much better equipped to deal with a volatile economic picture."