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Confidence and optimism appear to be returning to the SME sector, according to
the latest quarterly survey by KPMG.
Although the two previous KPMG surveys had referred to a chill wind blowing
through the sector, that storm appears to have been weathered according to the
latest set of figures.
When asked about the prospects for small and medium sized businesses in the
coming twelve months, the number of businesses replying “good” or “very good”
was up to 50%, a marked improvement from the 26% of the previous two quarters.
Optimism for their own business was even more bullish, with 68% feeling
confident about their prospects, equalling the highest return ever registered in
the two years the KPMG survey has been running.
Commenting on the results, Mel Egglenton, UK Head of Middle Market at KPMG,
stated: “After two quarters of doom and gloom, it’s a relief to be reporting on
some upbeat numbers.
"Overall sector confidence hasn’t quite returned to the levels we saw in late
2004 when we saw numbers in the 60s and 70s, but any improvement is to be
welcomed.”
“When you see an upswing like this, it is tempting to look for the one single
factor which might explain it all. Six months ago, 62% of businesses were
calling for an interest rate cut. They never got it. That number fell to 35%
last time round and further still to 28% this time.
"Throughout this time, interest rates remained static, suggesting that
businesses simply knuckled down and got on with it.
"Not getting the rate cut they craved did not deter businesses as a whole from
simply trading their way through what was a difficult time.”
There is still one note of caution, however, as the survey highlights a growing
concern over how much time senior management has to think about the big,
heavyweight issues which affect the strategic direction of the business.
In fact, 58% of the survey’s respondents felt that they were spending less time
than was ideal thinking about the strategic direction of their business.
Source:
Credit
Control Journal
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