Small business confidence remains in the positive in West Midlands

The SBI stands at +4.8 in Q2 2018, although the figures have dipped slightly since Q1 when it was at +7. The latest figures show around a third (34%) of small businesses expect their performance will improve over the coming three months. A total of 27% believe their performance will worsen.

The proportion of small firms saying that gross profits are steady or increasing is at 54%.

Growth intentions look promising, with the vast majority of small firms (87%) planning to remain the same size or expand in the coming 12 months. The majority (79%) also report steady or increasing headcounts.

Mike Cherry, FSB national chairman and a West Midlands business owner, said: “It’s good to see small business confidence maintaining its steady rise this month. Increasing consumer spending power and continuing momentum among exporters are all helping to keep optimism on the up, despite weak domestic growth.

“If we don’t see real progress on Brexit talks soon, however, we run the risk of this confidence being lost. The clock is ticking. Negotiators need to get on and secure a deal that works for small firms.

“Small business owners are resilient. They’re determined to grow despite the barriers they face.”

Following the introduction of the General Data Protection Regulation (GDPR) in May, the proportion of small firms across the UK saying that regulation is a primary barrier to growth has surged 10 percentage points to 29% since this time last year.

The domestic economy (57%) remains the number one barrier to small business growth, with access to appropriately skilled staff (28%) and labour costs (21%) also frequently flagged.

Mike Cherry continued: “It’s vital that the Information Commissioner’s Office takes a proportionate approach to enforcing the GDPR. Small firms don’t have big legal teams and that needs to be recognised. Small businesses definitely shouldn’t be fined for honest mistakes.

“A lot of eyes in Westminster are understandably still on Brexit. However, policymakers need to remember that it’s weak domestic growth, late payments and access to the right skills here at home that are front of mind for a lot of small firms.”