Small businesses confidence is at its highest since the fourth quarter of 2015, a recent Federation of Small Businesses (FSB) Small Business Index (SBI) report revealed.
Through the first quarter of 2017 the SBI reported a UK small business confidence of 20.0 – the highest number since the last three months of 2015.
This increase in growth has been attributed to a rise in international trade as a result of Brexit. Shortly after the EU Referendum a drop in sterling led to an upsurge in international trade as buying goods from the UK became cheaper.
This new figure for the beginning of 2017 is in spite of rising costs for small businesses. 64.5% reported an increase in operating costs over the past quarter, with 37% citing fuel costs as the principal reason for cost increase.
Particularly promising is small business confidence in Scotland, which has risen for the first time in nearly two years, although the figure remains negative.
Mike Cherry, FSB chairman, said: “We know small firms that export have higher turnovers than those who rely on the domestic market, so it’s crucial that the Government maximises cross-border trade opportunities for small firms.”
Cherry goes on to emphasise the importance of Brexit trade deals to the UK’s small businesses: “That includes negotiating an ambitious free trade agreement (FTA) with the EU as part of the Brexit process. The FTA must include a dedicated small business chapter and ensure the easiest possible access to the single market.
“Our latest Brexit research finds that over a quarter of FSB exporters would be deterred from trading with the EU27 by a tariff of any size.”
He added: “We cannot rely in the long-term on the boost that exporters have received from a weak pound. To maintain export growth, we need to focus on opening up new international markets and getting more small firms exporting”.