Confidence plunges amid no deal worries

Business confidence has plummeted among small Scottish companies as concern regarding a no deal Brexit grows, new figures show.

The third-quarter Small Business Confidence Index from the Federation of Small Businesses(fsb),whichmeasures company owners’ assessment of business conditions, fell from +5.1 points to -13.2 points in Scotland.

Across the UK, the index fell from +12.9 points to -1.7 points.

A separate FSB survey showed that 56 per cent of Scottish companies believe a “no transition, no deal” Brexit would impact negatively on their business, compared to 48 per cent of firms nationwide. Only 5 per cent of small businesses in Scotland believe it would have a positive effect.

According to the survey, only London firms are more concerned about a no deal Brexit than Scottish traders.

Almost a third of Scottish businesses said they plan to decrease investment ahead of March 2019, while many reported pressure on revenues and profits, alongside a spike in overheads, particularly the cost of fuel.

FSB Scotland policy chair Andrew Mcrae said: “The slide in business optimism over the last three months is perhaps unsurprising given the very public debate about the future of the UK outside of the EU.

“If you sell your products to the EU, buy goods from the EU or if your business relies on staff from the EU, you’re likely to see a no deal Brexit as a significant threat to your business. Businesses in Scotland are more likely to have concerns about this outcome.” 0 Andrew Mcrae, policy chair at FSB Scotland