Business confidence poll shows positive trend

Date: 15th July 2009

Confidence among smaller UK businesses is on the up, a new survey from Lloyds TSB Commercial has revealed.

According to the report, 31 per cent of firms expect sales rise over the next six months, while 30 per cent believe that they will still be falling at the end of the year.

When the same question was asked six months ago, this balance stood at -28 per cent - meaning that 28 per cent more firms were expecting a fall, rather than a rise, in sales.

Confidence over orders was also found by Lloyds to have risen over the last six months, with the balance moving from -25 per cent to +6 per cent.

The credit crunch and economic downturn has been a major factor in knocking the confidence of sole traders and small businesses in the UK.

Sales volumes and bank lending for the firms have both been severely squeezed in the recession.

John Maltby, managing director at Lloyds, added: "Restored confidence is the key to any [economic] recovery. So this evidence that firms are regaining faith in their business prospects is good news.

"But the survey indicates a levelling off in the downturn, rather than a return to strong growth. For the time being, profits will remain under pressure and investment will be on the backburner."

Over 2,500 UK firms were polled for the Lloyds study.