â¢ Macro-economic turmoil is the no. 1 worry for British importers and exporters.
â¢ Almost half of SMEs have little faith in âexport-ledâ recovery.
â¢ 62% unaware of Project Merlin.
Small and medium sized businesses (SMEs) are most worried about broader economic issues such as the global economy (84%), cheaper competition (70%), and currency volatility (65%), according to the latest data from the Travelex Confidence Index.
The findings also revealed that 59% of SMEs had little to no confidence in the current economic climate, representing a 32% drop from June and the lowest level of confidence since the TCI began in March 2010.
Top 10 concerns for SMEs1
1. Overall health of the economy (84%)
2. Cheaper overseas competition (70%)
3. Currency volatility (65%)
4. Reduced budgets (64%)
5. International regulation/compliance (44%)
6. Credit availability (43%)
7. Efficiency of international payments (39%)
8. Political influence (36%)
9. Reduced sales (30%)
10. Customer loss (27%)
Although credit availability came in at no. 6, SME awareness of Project Merlin is extremely low; 62% had not heard of Project Merlin and of those who had, only one in 20 believed it has helped them obtain credit.
Equally worrying ahead of the Autumn Statement is the fact that 66% of SMEs donât believe the governmentâs efforts to drive an export-led recovery have affected their business, with 48% thinking an export-led recovery unlikely despite policy-makersâ sustained campaign to depreciate the pound. With sterling fluctuating amidst an uncertain global outlook, external risks seem to have reduced the efficacy of the Coalitionâs current policies.
Paddy Earnshaw, Customer Director of Travelex Global Business Payments, comments on the recent data:
âThe results of this survey are not reassuring. Survival is paramount in the current climate; British businesses are worried about the basics of simply staying afloat.
âAccess to credit is certainly important, and it is worrying that nearly two thirds of SMEs donât know what Project Merlin is. It is not, however, the only concern for SMEs trying to navigate a hostile economy. If the government is serious about leading an export-driven recovery, then it should not focus solely on credit availability when there are other pressing issues to consider.â
As well as the lowest confidence level on record, the data showed that 68% of SMEs now think a âdouble-dipâ recession is likely, an increase of 80% compared to last November.
Earnshaw continued: âIt is not surprising SMEs are pessimistic about the health of the global economy given Eurozone woes. What is surprising is how little we have heard to date about solutions that address the real concerns of British SMEs. The Chancellor needs to set out clear plans in his Autumn Statement that tackle their fears over growth and economic volatility.
We have to question whether or not the governmentâs policies are actually addressing the needs of the SMEs they are meant to support.â
 Question: Which of the following issues do you think are most likely to affect the growth and development of your business?