Tuesday 23 January 2018

Confidence up among small firms but retail remains fragile

ISME’S Mark Fielding
ISME’S Mark Fielding
Colm Kelpie

Colm Kelpie

CONFIDENCE is on the up among small businesses, with uncertainty about the economy at its lowest level in almost seven years, a study has shown.

The latest quarterly SME Business Trends survey, released by the Irish Small and Medium Enterprises Association (ISME), shows improvements in 11 out of 12 economic indicators.

Mark Fielding, ISME chief executive, said small businesses are cautiously optimistic about the future as the country enters the post-bailout era.

But he said that while uncertainty about the economic environment has fallen, it still remains a considerable concern for many business owners.

"Owner-managers are still concerned about economic uncertainty and the upturn is not being felt equally across all sectors," Mr Fielding said.

"Retailers, in particular, are not benefitting from the reported increase in domestic demand and current sales have dropped.

"Unfortunately, this precarious situation means that jobs will be lost in retail due to government inaction."

The survey was conducted in the second week of December with 1,162 SMEs taking part.

Key findings include:

* Business confidence has increased from -5pc to +42pc.

* Business expectations have gone from 0 to +52pc in the space of a year.

* Economic uncertainty is now at the lowest level since spring 2007 but remains the biggest concern for employers.

* Sales expectations last month were positive at 28pc but this confidence was not felt across all sectors. In retail, sales expectations dropped to -35pc from -23pc.

* Investment remained static at 26pc, a sign that businesses are still unable to gain sufficient access to credit to expand and grow.

* Current and future employment experienced relatively strong increases, in line with current and future sales.

It comes as a separate survey from the Ireland France Chamber of Commerce (IFCC) showed the majority of its members reported an increase in business activity over the last three months.

'UPLIFTING'

Some 73pc said activity levels were higher, while 65pc said revenues had increased in the past three months compared to the previous quarter.

IFCC members include Air France, Alstom Ireland, BNP Paribas, Mazars, Renault Ireland, and Sanofi.

Jim Rice of Schneider Electric, president of IFCC, said the findings were "uplifting".

"Added to the increase in business activity, it is very assuring to see positive forecasts for the coming months," he said. "As a bilateral trade organisation, it is encouraging that nearly a quarter of respondents have experienced an increase in incoming business from abroad."

Irish Independent

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