Recent research conducted by the Forum of Private Business indicates that the confidence levels of small businesses have fallen yet again. Fears of a double-dip recession and the soaring costs associated with a business have caused confidence to plummet among small business owners.
Economy Watch, a survey conducted by the FPB every year has polled 350 small businesses, and discovered that in comparison to 2010, business confidence has dipped even further. Only one percent of the companies surveyed were confident of their potential for growth, while 43 percent admitted to not being very confident. Pessimism was admitted by 11 percent of small businesses.
During the last 12 months, a number of businesses have seen rising profits and an improvement in trading conditions, although they say that rising costs take up much of that profit. According to the chief executive of FPB, Phil Orford, owners of small businesses struggle to maintain decent profit levels due to the soaring costs of business finance, which is also scarce. He added that a number of small businesses are being hampered by the crisis of confidence in the economy, cashflow problems and lack of consumer confidence.
Rising business costs are a problem for almost two thirds of companies surveyed, with 45 percent complaining about higher taxes, 31 percent struggling as a result of late payments and 19 percent blaming the rising cost of finance for difficulties. A spokesperson for the Department for Business, Innovation and Skills said:
“We have already cut the tax rate for small firms to 20 percent, scrapped planned regulations to save business £350 million each year and announced an unprecedented three-year moratorium on new domestic regulation for micro-businesses and start-ups.”
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