Companies still positive despite virus

CONFIDENCE among small to medium sized enterprises (SMES) has held up in the absence of another national lockdown, according to research from Hitachi Capital Business Finance.

It found that 73 per cent of small businesses believe that conditions will either improve or stay the same during the fourth quarter, an increase of three percentage points on the preceding quarter. The proportion of SMES that believe they will shrink during the fourth quarter fell four points to 15 per cent.

Aside from Britain not being placed in total lockdown again, Hitachi attributed the confidence of SMES to the sense that the current restrictions will stay in place until March, giving people a sense of certainty against which they can plan.

Hitachi’s survey found that although confidence among small businesses has recovered from the depths of lockdown, it is still below where it was prior to the outbreak.

The proportion of SMES predicting growth was 27 per cent, versus 14 per cent during lockdown. Prior to the outbreak, the percentage of smaller companies predicting growth was at least 36 per cent on average.

“Our data suggests small businesses are reacting positively to the current circumstances,” Joanna Morris, head of insight at Hitachi Capital, said.

“The stabilising of confidence levels is a really important development as it suggests smaller enterprises that can operate are adapting to the new reality and accept the prospect that we may all be in for a long-haul fight against Covid-19.”