Research from the Sage Business Index by the Sage Group says international businesses predict an average of 2.5 percent rise in turnover over the next 12-months.
The yearly Sage Business Index survey questioned approximately 14,000 small medium businesses (SMEs) across 18 countries, revealing global businesses are experiencing a four-year high. The Sage Business Index has been conducting similar research since 2011 and has its own point system. From the report, both an increase in employees and turnover is expected with confidence growing from 62.01 in 2013 to 64.14 in 2014.
Europe mostly paints a picture of optimism with Ireland and Spain confident, with a score of 56.40 and 54.14 respectively. Meanwhile, Germany, Poland and the UK are even more optimistic whereas in Austria, Portugal and Switzerland all score below 50 with pessimistic views. France is the most pessimistic European countries surveyed with a score of 44.08.
The report covers predictions for growth, attitudes to risk, barriers to growth and export - outlining how businesses are reacting the challenging economies. Sage Group CEO, Guy Berruyer explains, “Confidence has been on the rise for some time but we appear to have reached a global tipping point where for the first time businesses are optimistic about the prospects for their business, their national economy and the global economy. This is underlined by their business predictions for the year ahead.”
Although British entrepreneurs are more bullish about future economy and growth, risk is an element that has an impact on how businesses perform. Brazilian and US counterparts are bigger risk takers whereas the UK entrepreneurs are reluctant to take chances that other business owners are more willing to embrace. The research shows that 29 percent of UK business owners claim they are more willing to take risk than previously, while 54 percent of them have not changed their attitudes.
The lack of risk taking by UK businesses is outshone by the ability to export, with 10 percent of British companies experiencing a decline in export sales as highlighted by the report authors. “However, more must be done to support businesses with ambitions to grow their exports – a key factor in the continued growth of the global economy,” continued Berruyer.
Even though there remain barriers that hinder success particularly in exporting, overall, confidence and support appears to be better in the UK than is being experienced by other European countries. This is way the decline has been stemmed and the potential is promising for UK SMEs.
Although the prediction by businesses is promising, recent news reported by the BBC is a stark reminder how quickly things can change. It was reported that European and US stock markets were seeing a sharp falls as fears deepened over prospects for the global economy from various issues that have an impact upon confidence. Therefore, it is critical that businesses have as much information as possible to ensure more informed decisions are made.
The full research can be found at businessindex.sage.com.
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