Wiltshire small businesses reveal loss of confidence in FSB report
It follows a boost earlier in the year
Confidence among small businesses in the South West has dropped substantially according to a report from a regions Federation of Small Businesses (FSB).
It's a concern as a similar report earlier this year showed confidence had grown.
The report, which survey's local businesses, covers the second quarter of the year - which included the run up to the General Election.
Development Manager for the FSB in Wiltshire, Ruth Lambert, told Greatest Hits Radio the drop in confidence is a shame.
"I'm hoping is not a sign of things to come, but it's more a reflection of we were in the run up to the election," she said.
She said that interest rates were high at the time and while things are still uncertain, she's hopefully the next report will see a trend in the right direction.
Everyone feeling the pinch
In the survey, businesses are asked what they feel is holding them back - with most saying the general economic conditions, while many have mentioned recently about people spending less.
Ruth said: "We know that people are still feeling the pinch in their pockets are still quite slow to spend, are feeling like they haven't got as much disposable income.
"So people are holding back on projects being a bit more cautious, maybe scaling back their plans and obviously that's all impacts businesses and their ability to plan their own, their own cash flow and their own income."
Ruth said businesses are 'driving with the handbrake on whilst wearing sunglasses at night' as a result of people not having as much disposable income.
She added that labour costs have increased too, which is putting extra strain on profit margins.
"You can't just put up those people on the lowest wages. You have to put up the people on the higher wages as well to keep those pay differentials.
"A lot of businesses that I speak to have found that their labour costs have gone up quite substantially recently, obviously nobody would begrudge anybody any money, but it is an additional challenge for those for those businesses."
As a result, a little over half of businesses surveyed said they were expecting rapid or moderate growth in the next 12 months.
"We just hope that those that aren't expecting to grow will manage to survive and maintain their levels of trade," Ruth said.
Hopes of brighter times ahead
While businesses are braced for some tricky times, the report did offer some glimmers of hope.
With businesses being able to pay their staff more, it suggests that some company's are still trading well.
And a number of them are planning to boost staff numbers in the next quarter, indicating that they are identifying opportunities for the future, which Ruth described as 'encouraging'.
Ruth told us that small businesses owners are among the best at reacting to trends and coping with changing situations.
She said: "We all know that small business owners are very agile and entrepreneurial by nature. So you know it's if anyone can cope with it, they can."