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Retail SMEs Cautiously Optimistic About Coming Year

Published on Jan 21 2014 11:42 AM in Retail

Retail SMEs Cautiously Optimistic About Coming Year

The latest ISME Quarterly SME Business Trends survey for Q4 2013 has found that while retailers are slightly more optimistic about their business prospects, sales expectations remain well below the overall average.

Business confidence among retailers climbed 22 percentage points to +13%, however expectations dipped slightly to +4%. This marks a 46 point improvement on business confidence in the year, and a 28 point improvement in business expectations.

However, retailer business confidence is well below the overall cross-industry average of +42%. Overall business expectations stand at +52%.

In terms of sales expectations, retailers report a sales expectation figure of -35%, a 12 point drop on Q3. This compared to positive sales expectations across all industries of +11%.

Similarly, retailers exhibit a degree of pessimism when it comes to future employment in their sector, with future employment expectations dropping 14 points to -9%, despite rising by 20 points in the previous quarter. This indicates that the employment optimism seen in the retailer sector in the previous quarter has not been sustained.

Across all industries, the report noted positive moves in 11 of the 12 business indicators, with business confidence having risen from -5% to +42% over the course of a year, and business expectations having risen from 0% to 52%.

“As we enter the post-bailout era, SMEs are cautiously optimistic about the future," said Mark Fielding, ISME Chief Executive. "11 of the 12 indicators have improved on 2007 levels at this point. However, owner-managers are still concerned about economic uncertainty and the upturn is not being felt equally across all sectors.

“Retailers, in particular, are not benefitting from the reported increase in domestic demand and current sales have dropped from -23% to -39%. Unfortunately, this precarious situation means that jobs will be lost in retail due to government inaction.”

The ISME Quarterly Trends Survey is based on responses from SME owner managers across all sectors of the economy and is presented as a balance of sentiment for twelve indicators. The result is a simple balance between positive and negative. For instance, for the question on business confidence, “are you more or less optimistic about business prospects than you were 12 months ago?” the results are a net of the replies.

© 2013 - Checkout Magazine by Stephen Wynne-Jones

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