Business confidence is expected to plummet to its lowest level since the beginning of 2014 according to new findings.
The Bibby Financial Services’ latest SME Confidence Tracker suggests that business owners are taking a cautious approach to capital expenditure, hiring and business growth.
The report shows that less than half (46%) of SMEs expect their business to grow, down from 64% in Q1 2014, when the survey began.
David Postings, Global Chief Executive of Bibby Financial Services, said:
“UK SMEs are sensing dark clouds on the economic horizon, which is translating into dampened expectations for growth in the final months of 2015.”
The report goes on to suggest that the number of businesses expecting a decline in their sales is at its greatest since the inception of the SME Confidence Tracker.
The findings imply that company investment is not a priority at the moment for business owners with 46% admitting that they are not looking to put money into the business. This is down 60% compared to this time last year.
The research also reveals that over half (57%) don’t plan to hire new staff in the next three months.
Small businesses that are planning to invest appear to be focused on the general upkeep and maintenance of their business. Their primary reasons for investment are keeping ahead of the competition and replacing machinery and equipment that had deteriorated, indicating a ‘business as usual’ approach to capex, rather than funding growth.
Mr Postings continued:
“It seems that even our smallest businesses are taking fright in response to gloomy indications from both the Bank of England and the IMF.
“With the distinct possibility of another recession in 2016, small businesses need support and stability. The urgent appointment of the Small Business Commissioner to tackle the issue of late payment would significantly help our small business owners to weather the storm.”