Declining consumer demand is a much bigger problem than access to finance for small and medium-sized enterprises (SMEs) across the UK.
Declining consumer demand is a much bigger problem than access to finance for small and medium-sized enterprises (SMEs) across the UK.
A fall in demand affected 64 per cent of the survey’s 1,000 respondents during the first quarter of the year, with only 25 per cent held back by a lack of finance.
Professor Robin Jarvis, head of the small business unit at accountancy organisation ACCA, which released the survey in conjunction with the Open University and Barclays Bank, says that both deposits in banks and term lending are on the rise.
Adds Jarvis, ‘Compared to the 1991 recession, businesses are now much more concerned about falling demand [than] the availability of finance, so the government should focus its efforts on stimulating consumer demand.’
Other concerns for the SMEs surveyed were problems with suppliers or trade credit (14 per cent) and the need to shed key staff or deal with morale issues (13 per cent).
Regionally, falling consumer demand has had the greatest impact on businesses in the West Midlands, with 75 per cent of SMEs reporting it as a problem, while Scotland appears least affected with 56 per cent.
Overall, Scottish SMEs appear to be weathering the recession best of all, with more than a third (34 per cent) saying they had not been adversely affected by any of the issues they were questioned about. In contrast, Wales and North East England had the lowest level of unaffected businesses (both 19 per cent).
