More West Midlands small firms expect to struggle
The number of small businesses predicting growth for the next three months has hit its lowest level for more than a year and the amount predicting they will struggle to survive or close has doubled from five to 10 per cent in just three months, according to new research from Hitachi Capital Business Finance.
In the West Midlands the percentage of small and medium-sized businesses predicting they will struggle to survive has tripled from three to nine per cent in the period.
Hitachi Capital’s Business Barometer tracks small business confidence every quarter:
Over the last two years, the proportion of small business owners fearing collapse has been consistent at around four to five per cent for seven consecutive quarters.
The new Hitachi Capital data revealed dramatic rises in the retail and hospitality sectors in terms of the proportion of small businesses that think they will struggle to survive in the next three months. This follows bleak industry predictions last weekend that 10,000 retail stores will shut this year, of which half will be independents.
The barometer suggests the protracted uncertainty and political infighting around Brexit is creating an economic ripple that could cause lasting damage to the small business sector, the engine room of the British economy.
Overall, in eight industry sectors there was a quarterly rise in the proportion of small businesses that feared for their future.
The North East and London saw a sharp rise in the percentage of small businesses worried about their survival and overall, nine UK regions saw a rise in the proportion of business owners predicting that their enterprise would struggle to survive in the next three months.
Gavin Wraith-Carter, managing director at Hitachi Capital Business Finance,said: “For the last year, our research has shown that the small business community has seen political and economic change as an opportunity. Many have looked to expand into markets beyond the UK and create jobs in the communities where they do business. Our latest findings, though, suggest the protracted nature of Brexit negotiations may now be taking its toll.
“It’s also clear from our latest research that small businesses are focusing heavily on the financial health of their business – whether this be improving cash flow, getting tougher on late payment or looking for better ways to secure finance. The key thing is that they shouldn’t leave it too late."
