Charting a Course to Success?
FSB Says You're Heading in the Right Direction.
With 200,000 members, the Federation of Small Businesses is one of the UK's strongest supporters of the kind of dedicated adventurer that RIFT Accounting loves. They always make sure they know which way the winds are blowing in the business world, and their most recent report is encouraging stuff. Polling their members, they've found confidence, positivity and real results are all on the rise. Here's a quick summary:
You've Got the Right Attitude
Small businesses are running with confidence and a positive outlook. The economic recovery and lower business costs are taking some of the heat off and firms are getting easier access to finance from banks. The upswing in confidence is showing in the number of employees they're taking on, and also the amount they're paying them.
To put it in real terms, the Small Business Index (which measures UK small business confidence) is securely in the positive zone. Currently sitting at +28.7 points, it's risen 11.1 points in the last quarter.
You've got the Right Motivation
With inflation low, small businesses are finding their costs being kept down. The FSB's latest report says that less than half of them are even reporting an increase in their business costs compared with last year. At just over 44%, that's actually the lowest proportion ever reported!
Low inflation also means that consumers have a little extra buying power at their disposal, which is a boost to business confidence in itself. Furthermore, the percentage of small businesses whose bank loan applications are being accepted has increased to 57%. That's a full 12% higher success rate than twelve months ago.
You've Got the Right Idea
The number of people small businesses are taking on is a key point. Right now, that number is twice what it was a year ago. The confidence business owners are feeling is having a definite effect on their planning, but it's also being reflected in their bottom lines. 19.5% of the businesses polled say that their revenues increased over the last three months
Looking ahead, the FSB report tells us that small businesses are expecting to raise salaries by 1.8%, which again is an increase over the previous year.
There Are Still Things to Watch Out For
One of the key strengths of the FSB's reports is the way they offer a lot more than just the raw numbers. Putting those numbers in context can also pinpoint areas of concern and specific hurdles to overcome. For example, many small businesses are still struggling getting the right teams together. 37% of the businesses polled said that finding someone with the right skills was becoming difficult, with that figure being a steep rise over last year's 25.4%. Putting the right employee in the right position is always important, particularly for businesses looking to be competitive in Europe, but being aware of the challenge is the first step toward tackling it.
Confidence and a positive attitude are not just the results of success, they're also good predictors of it. Keeping focused on your goals and aware of the obstacles you'll face reaching them will go a long way toward building a stronger business, so talk to RIFT Accounting to hear more about what the FSB's report means for you - and keep watching this space for more Voices from the RIFT...