Small businesses 'face tough 2008'

Retail businesses of a smaller size will face difficult trading conditions in 2008, an industry group has stated.

The British Retail Consortium (BRC) predicted that the sector will experience a testing time over the next 12 months, with smaller retail firms particularly likely to come under pressure from the effects of the credit crunch.

Richard Dodd, head of media and campaigns at the BRC, said that increased pressure on consumer finances and rising costs would make conditions difficult for small retailers, with good business accounting becoming even more important as a result.

Mr Dodd explained: "Conditions will be tougher, certainly in the next six months, than they were last year because customers' personal finances are under severe pressure.

"Retailers generally, although it does fall disproportionately hard on smaller retailers, are facing a whole string of rising costs."

The new year message from Richard Lambert, director general of the Confederation of British Industry, stated that 2008 will be "a difficult year for British business".