www.fsb.org.uk/scotland
SCOTLAND Q2 2020 SMALL BUSINESS INDEX Small businesses experience a significant boost to confidence Small Business Confidence across the UK, but overall levels of confidence in Scotland are still 60 below the UK average.
-60 -80 -100 -120 -140
Scotland SBI
UK SBI
Q2 2020
Q4 2019
Q2 2019
Q4 2018
Q2 2018
Q4 2017
Q2 2017
Q4 2016
Q2 2016
Q4 2015
Q2 2015
Q4 2014
Q2 2014
Q4 2013
Q2 2013
-160
Source: FSB Small Business Index.
Net balance of small firms in Scotland reporting revenue/profit growth 30%
10%
-10%
-30%
-50%
-70%
Revenue
Profit
Q3 2020
Q1 2020
Q3 2019
Q1 2019
Q3 2018
Q1 2018
Q3 2017
Q1 2017
Q3 2016
Q1 2016
Q3 2015
Q1 2015
-90% Q1 2014
The picture is somewhat less negative looking forward to Q3, though unsurprisingly the majority of Scottish small businesses still expect a further quarter of falling profits.
-40
Q3 2014
Businesses in Scotland see largest fall in profitability in Q2. As a result of the drop in demand arising from lockdown restrictions, businesses across the UK have seen a fall in both sales and profits. The most recent SBI data show that businesses in Scotland were most likely to report falling profits, with 81.8% of small businesses reporting a decrease in gross profit levels in comparison with the UK figure of 74.9%. Accordingly, the net balance figure for Scotland was also the lowest of all the UK’s constituent nations and regions, standing at -71.9%.
-20
Q3 2013
Small businesses in Scotland are most negative about the impact coronavirus will have on future business performance. When asked specifically about the impact coronavirus will have on confidence in overall business performance in the next three months, all regions and nations recorded a negative net balance figure on this measure. However, Scotland was the most overwhelmingly negative at -75.9% in comparison to -66.1 for the UK. This net balance in Scotland is the result of 6.2% of businesses reporting an increase in confidence, which was clearly outweighed by the 82.1% reporting that their confidence had been affected as a direct result of coronavirus.
0
Q1 2013
Across the UK as a whole, small business confidence recovered by 138.4 points in Q2, though most regions and nations remained in negative territory. The UK-wide SBI witnessed a significant recovery following the record low reading of -143.4 in Q1. That the figure remains slightly negative suggests that nationwide small business confidence remains fragile, however, with the lockdown-induced slump in activity fostering widespread uncertainty. Though the index suggests some regional variation in small businesses’ outlooks, Scotland is one of the least optimistic geographies heading into Q3 – as is the case in previous quarters. Only London (-25.6), the South East (-14.4), and the East of England (-10.2) reported lower index scores than Scotland, which is unsurprising since a different pace of unwinding lockdown restrictions was adopted north of the border.
20
Q4 2012
The recovery witnessed in Scotland was the third largest of all the UK’s constituent regions and nations in terms of raw index points. Only the North West (184.4 points) and the West Midlands (146.4 points) saw a larger improvement on the SBI between Q1 and Q2.
40
Q3 2012
The FSB Scottish Small Business Index (SBI) increased 144.7 points to reach -10.1 in the second quarter of 2020. This marks a significant recovery from a record low of -154.8 points in Q1. In line with broader UK-wide trends, Scottish small businesses are uncertain heading into Q3, though such negativity is significantly less overwhelming than that recorded three months ago.
Source: FSB Small Business Index