According to the Small Business Index for Q4 2023 by the Federation of Small Businesses, small firms are facing challenges due to late payments, impacting growth expectations for 2024. The report provides insights into small firms’ sentiment and experiences, revealing a decrease in optimism amidst tough trading conditions.
FSB National Chair, Martin McTague, noted that the economy suffered a setback in Q4 of 2023, which led the UK into a recession. To reignite growth, a focus on kickstarting investment and expansion is crucial. One obstacle hindering investment among small firms is the practice of demanding personal guarantees for even small amounts. The FSB raised a super-complaint regarding this issue with the Financial Conduct Authority to address its negative impact on growth and investment.
The extension of Government funding for the Recovery Loan Scheme, now known as the Growth Guarantee Scheme, in the recent Budget, is expected to support the expansion plans of numerous small firms. However, concerns loom regarding the planned removal of the SME Supporting Factor by the Bank of England’s Prudential Regulation Authority, potentially limiting financing options for small businesses.
The small firms industry is facing a holding pattern, with particular sectors like hospitality experiencing a significant downturn. Late payments continue to be a major concern, causing stress and harm to small business owners. Large companies need to prioritize timely payments to small suppliers to improve transparency and accountability.
Despite sector variations, small firms show optimism for growth in sectors like information and communication, manufacturing, and professional services. Retail and wholesale industries are slightly less optimistic, while the hospitality sector remains notably pessimistic about future prospects.
The proportion of small firms experiencing late payments increased from Q3 to Q4, indicating a worsening trend. Views on the availability and affordability of new credit remain negative, with a high percentage of small businesses rating it as poor. Successful applicants for new credit are facing higher interest rates, reaching a new record high according to the SBI.
According to the Small Business Index for Q4 2023 by the Federation of Small Businesses, small firms are facing challenges due to late payments, impacting growth expectations for 2024. The report provides insights into small firms’ sentiment and experiences, revealing a decrease in optimism amidst tough trading conditions.
FSB National Chair, Martin McTague, noted that the economy suffered a setback in Q4 of 2023, which led the UK into a recession. To reignite growth, a focus on kickstarting investment and expansion is crucial. One obstacle hindering investment among small firms is the practice of demanding personal guarantees for even small amounts. The FSB raised a super-complaint regarding this issue with the Financial Conduct Authority to address its negative impact on growth and investment.
The extension of Government funding for the Recovery Loan Scheme, now known as the Growth Guarantee Scheme, in the recent Budget, is expected to support the expansion plans of numerous small firms. However, concerns loom regarding the planned removal of the SME Supporting Factor by the Bank of England’s Prudential Regulation Authority, potentially limiting financing options for small businesses.
The small firms industry is facing a holding pattern, with particular sectors like hospitality experiencing a significant downturn. Late payments continue to be a major concern, causing stress and harm to small business owners. Large companies need to prioritize timely payments to small suppliers to improve transparency and accountability.
Despite sector variations, small firms show optimism for growth in sectors like information and communication, manufacturing, and professional services. Retail and wholesale industries are slightly less optimistic, while the hospitality sector remains notably pessimistic about future prospects.
The proportion of small firms experiencing late payments increased from Q3 to Q4, indicating a worsening trend. Views on the availability and affordability of new credit remain negative, with a high percentage of small businesses rating it as poor. Successful applicants for new credit are facing higher interest rates, reaching a new record high according to the SBI.