A report carried out by Aviva insurance firm has revealed confidence levels are at their lowest among small business owners in the United Kingdom. A mere 13 percent of business owners believed that the UK economy would improve before the end of 2011. The SME Pulse report has warned of fears that nine percent of businesses could fail in 2011 unless the conditions for trading saw a drastic improvement.
More than a third of small business owners consider that conditions for trading are more difficult than 2010, which is a drop of two percent from last years figure. Shops and salons revealed that 43 percent considered trading conditions to have declined, although the restaurant trade had found the conditions much better than previously expected.
A double-dip recession is likely, according to 28 percent of SME’s, with the same percentage not expecting any improvement over the summer months. The commercial product manager of Aviva, David Bruce said:
“It is evident that the tough trading conditions we saw last year have continued into 2011. Confidence among SME’s is as low as it has been since the onset of the recession and many feel they are in real danger of losing their businesses should the economy fail to improve this year.”
According to Bruce, businesses will rely on the same strategies as this year in order to survive, with staff cuts, discounted goods and introduction of new products and services. Unless the economy shows some improvement and business investment improves, the future looks bleak for small business.
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