The Big Small Business Survey for Wales State of the Nation
Thank you to all the small businesses across Wales who have supported our work and contributed to this research.
When asked which initiatives would most impact business performance positively, the top five were:
Small businesses most want to see the Business Rates refromed in the following ways:
Only 10% are optimistic about the Welsh economy, 63% are pessimistic. But 52% Optimistic about their own business. 72% 39% 23% 22% 26% 55% 46% 40% 39% Lower business taxes (e.g. National Insurance, business rates):
Incentives and reliefs for small businesses operating in town centre locations
Eligible reliefs automatically applied to bills
Moving away from a tax based on the property value of the premises
Introduction of permanent, additional reliefs for specific sectors
Introduction
Small and medium sized enterprises (SMEs) are the backbone of the Welsh economy, shaping local communities, employment, and innovation.
The Big Small Business Survey Wales provides a snapshot into the current outlooks, priorities, and challenges for SMEs in Wales. This report brings together the survey findings on the Welsh small businesses around themes such as productivity and growth aspirations, confidence in the economy and priorities for Government action, and well as areas such as digitalisation, tax and regulation views, infrastructure and transport, exporting, placemaking and productivity.
It is incumbent on all parties with ambitions to form or be part of the next Welsh Government to address the needs of Small Businesses as a driver to economic growth and prosperity. Whatever its political stripe, the next Welsh Government must make building the foundations and supporting the drivers for growth and prosperity across all our communities a priority and SMEs are a key focus to that end. In the end, any Welsh Government in place after May 2026 will need to help SMEs thrive if it is to achieve its ambitions.
The next Welsh Senedd term should be one focused on building the Welsh economy.
Based on over 350 responses, and a range of survey questions covering the key issues we have identified from small businesses over the last Senedd term, this online survey provides vital evidence to support policy priorities and decision-making for the next Welsh Government.
Dr Llŷr ap Gareth, FSB Wales, Head of Policy
Felix Milbank, FSB Wales, Deputy Head of Policy
Our survey asked a wider range of questions encompassing issues such as productivity and growth aspirations, confidence in the economy and priorities for Government action. Our aim was to get a broad analysis of the general issues businesses face.
Most businesses agree on the core issues affecting their business and broadly share views on the current business environment – they are aspirational and want growth and passionate about what they do, and broadly share priorities around what support systems are needed, what needs to change in terms of amount of tax, how tax and regulation are shaped and their principles, and what support mechanisms and interventions would best support their businesses, their sector and the economy. We note where there are variations – with caveats on data as necessary – and useful indicative differences across the sample.
We hope this work will help support policy makers of all political persuasions in outlining priorities that support our crucial small business sector in Wales, who are embedded and support local economies, employment and wellbeing across all areas of Wales. This work also sits alongside FSB Wales’s 2026 manifesto, ensuring the voice of small businesses are well represented in FSB Wales’s calls to all parties in the crucial Senedd elections in 2026.
Survey Sample Overview
Firstly, we asked a series of questions about the survey respondent and their businesses, to understand the demographics of the firms who responded to the survey.
Over 350 businesses responded to the survey, although not all answered all 40 questions - some dropped out as the survey went on, and some were also filtered out in some questions to not include those to whom it was not relevant.
As such, it is a decent sample for a Welsh business survey from which we can pick up key data and where there are strong responses we can be confident in our analysis, but less so on minor differences in responses. With some limitations that we outline in this section,
it is broadly representative of Welsh small business demographics. This adds to the confidence in the inference we make in analysis. Nevertheless, while it is a good number for a business survey in Wales, there are limitations to the data and it is necessarily subject to random variation and bias.
The later analysis in this report do also look at subsamples – these should be seen as indicative only and treated with some caution, but it is useful to pick up on variations with those caveats. We note where results should be treated as indicative only.
The breakdown by business size is as follows, broadly aligning with the demographics of the wider business population:
Q1 How many people currently work in your business? (excluding yourself)
In a separate question we also asked how many respondents had staff with 35% being self-employed or sole traders.
Responses were received from every local authority in Wales, with Cardiff, Gwynedd, Rhondda Cynon Taf, and Carmarthenshire somewhat overrepresented. These areas provide a broad balance of rural and urban regions across Wales, but local data would be of limited significance and so we look at regions in the following section.
The sectoral breakdown followed the general trend observed in our surveys, with professional, scientific, and technical services being the highest (20%), followed by accommodation and food services (16%).
The gender breakdown was more balanced than the wider business demographic, with 46% female respondents. As is typical in surveys, the age range skewed older, with 66% being over 50. Additionally, 17% reported a long-term health or disability issue that limits their daily activities in some way. 94% identified as White British.
Business and Economy
This section examines what drives businesses, their attitudes toward growth, and the actions that would support them. It provides the broad economic context for calls on Welsh, UK and local governments regarding the economy. Motivation
The following outlines what motivates small businesses in their work, showing that, alongside money, passion and autonomy are key drivers for business owners:
Q8 First, looking at the list below, what are the TWO main motivations for you personally in running your business?
I work in an interesting field/am...
To make money
It gives me control over my work and/or
To contribute to my community
To fufil a wider social or environmental...
Growth
As our surveys typically show, most SMEs aspire to grow:
Q9 What are the growth aspirations for your business over the next 12 months?
To grow rapidly (more than 20%)
To grow moderately (up to 20%)
In terms of development priorities over the next few years, productivity and creating new products/services ranked highest, with succession planning third.
Q10 How would you most like your business to develop over the next 2 years? (please choose up
to 3)
Become more productive
Develop new products and/or services
Developing a succession plan
Become more innovative
Become more digital
Improve employee pay/conditions
Training and development for employees
Become more environmentally sustainable
Attract new investment in my business
We know from broader surveys that businesses currently lack confidence. Therefore, we asked about confidence across spatial levels, from their own business to the global economy. The following chart shows how the confidence level changes from own firm level up to the more abstract economy – with the Welsh economy being the level in which our respondents were least confident:
Q11 How optimistic or pessimistic are you about the next five years in terms of:
This indicates that, broadly, SMEs are more confident in their own business and sector than in the wider economy.
In terms of variation, there was some variation by geographical area – whether by rural/urban or by more confidence in South East Wales. We will address this regional variation in a later section on regional variation in general.
On confidence, there was some variation by age. However, it is not possible to disentangle age from the demographic being more likely from a more economically productive area. In short, young people are more likely to be in Cardiff, which is more likely to be successful and have businesses of this ilk, and the correlation could also be explained by younger people in Cardiff help make that area more productive.
Welsh Government Actions
The top three actions businesses prioritise for Welsh Government are:
Reducing business taxation (e.g. business rates, National Insurance Contributions)
More incentives and support for employing new staff or apprentices
Taxation is by far the most significant issue, suggesting Welsh Government should explore new powers and levers to address the impact of recent tax increases. High streets and support for skills development are other key priorities.
Nevertheless, it is useful to note for further research.
Of the 119 of the sample who were 50 or under were notably more optimistic on the Welsh economy (2.44) and more confident on Welsh economy than UK economy (2.30) and Global Economy (2.38). This variation in confidence in the Welsh Economy also occurs in the south east cohort (and the younger part of the sample are more likely to based here and in particular Cardiff), it is more so with the under 50 cohort. They were also notably more optimistic on their own business, their business sector and small business sector as aa whole. They were also more likely to export, be looking to attract new investment and employees into their business. And select ‘Improving SME access to finance’ as priorities.
When asked which initiatives would most impact business performance positively, the top five were:
70% 72% 39% 23% 26% 22% 28% 27%
Lower business taxes (e.g. National Insurance, business rates)
Access to appropriately skilled staff Access to business support Access to finance Supporting high streets
Better and simpler regulation
High Streets
High streets are a key concern for FSB and an area of economic development where Welsh Government holds many key policy levers, making it a focus for the Senedd elections next year. We first asked how businesses viewed their high streets, and the results were unsurprisingly negative:
Q34 How would you describe your local high street or town centre? Feel free to add comments to elaborate
For FSB Wales’s survey for the 2021 report A Vision for Welsh Towns, which surveyed the public as well as businesses, we found that only 3% (compared to 4% in this survey) considered their high street to be thriving. In that survey, 67% viewed their high street as ‘bad’ (33%) or ‘bleak’ (34%). It should be noted that this survey was conducted in late 2020, when the impact of the COVID-19 pandemic was still significant.
By comparison, the results of this survey of business owners are less negative regarding high streets but remain far from positive. A majority, 53%, viewed the state of high streets as ‘bleak’ (35%) or ‘bad’ (18%), with 28% neutral. Only 18% saw high streets as ‘good’ (14%) or ‘thriving’ (4%).
The actions businesses would like to see prioritised for high streets are as follows:
Q35 In your view, which of the following measures should be prioritised to help revitalise your nearest high street? Please choose up to THREE options that you think are most important
Become more productive
Develop new products and/or services
Developing a succession plan
Become more innovative
Become more digital
Improve employee pay/conditions
Training and development for employees
Become more environmentally sustainable
Attract new investment in my business
The primary measure identified as key to addressing high street regeneration is ‘incentives to fill empty properties.’ This suggests that measures such as business rates holidays for new businesses and reliefs for ‘bricks and mortar’ businesses in high street locations would be welcomed and could address longterm issues while building a tax base for the future.
In order to look at the priorities of high street business e cross tabulated businesses located ‘on or near a
high street’ to see if they had different sentiments or priorities. However with the lower response rate (101) and only 36% were near or on high street, this should be seen as indicative only.
Below is the sentiment about the state of their local high street results for those businesses on or near the high street, which are more positive than the wider responses:
29% 16% 28% 5% 22%
Here, ‘neutral’ is the highest response at 29%, but 50% still rate the high street as ‘bad’ (22%) or ‘bleak’ (28%). Meanwhile, 21% view it as ‘good’ (16%) or ‘thriving’ (5%). This subsample of only 101 businesses is indicative, and the differences are relatively small. However, these businesses are less likely to rate high streets as ‘bleak,’ suggesting they see improvement and potential for improvement.
When comparing high street businesses to all businesses surveyed, the following issues stand out:
• More high street businesses than ‘all businesses’ consider public bus transport (48%) and trains (47%) important to their operations.
• 49% cite a lack of affordable parking as the biggest issue for this subsample.
• 39% feel unsupported on net zero initiatives and would like support.
Neutral
Good
Bleak
Thriving
Bad
Business Rates and Tax
Business Rates
We presented a stark choice on whether Welsh Government should completely reform the NDR system or leave it as is, to gauge the strength of feelings on the issue:
Q24 On the non-domestic rates system - also known as ‘business rates’do you think the Welsh Government should:
No view / Don’t know 42% (117)
Completely reform the non-domestic rates system for all sectors 51% (141)
Make no changes to the current non-domestic rates system 8% (21)
Clearly, many businesses are very dissatisfied with the system and would like it reformed. However, the high number of ‘Don’t Know’ responses serves as a corrective, suggesting that for many, it is not a pressing issue or that they did not align with the two stark choices provided.
The fact that the ‘Don’t Know’ respondents were not generally passive is evidenced by the fact they still provided preferences for specific initiatives to reform the business rates system. As such, these are likely respondents cautious about change and decided neutrality was their best option.
The following were the highest priorities give for NDR reform initiatives, some of which can be based on the current system and others more dramatic changes:
• Incentives and reliefs for small businesses operating in town centre locations: 55%
• Eligible reliefs automatically applied to bills: 46%
• Moving away from a tax based on the property value of the premises: 40%
• Introduction of permanent, additional reliefs for specific sectors: 39%
• Ensuring businesses pay the same rates for similar property bands across all local authorities: 17%
• Reform of the appeals system: 6%
Clearly, businesses view business rates as a key lever for high street regeneration. Another priority is simplification and transparency through automatic reliefs (rather than discretionary ones) and we know that many find the system opaque and difficult to navigate. Support for permanent reliefs for specific sectors in need highlights the desire to use the system to support sectors economically and acknowledges that the current system does not value businesses fairly or consistently across sectors. All of these are reforms a new Welsh Government could enact effectively with the powers at their disposal.
The 40% support for moving away from a propertybased tax is notable and suggests further exploration of alternatives like Land Value Tax and its variations, as studied by Bangor University, though the transition and details will be critical. Other approaches could involve balancing taxes by reducing business rates while offsetting elsewhere, though challenges arise due to different levels of government control and the need to ensure local funding for services.
Visitor Levy
64% of respondents opposed the Visitor Levy, compared to 16% in favour.
The legislation aims to hypothecate the levy to some extent, although we have raised concerns about its practical application in our evidence to the Senedd and the need for additionality. We provided options for how the levy should be spent, broadly aligning with the guidance provided in the legislation. The results are as follows:
Facilities (e.g. public toilets, bins, parking spaces)
Infrastructure (e.g. road maintenance and transport links)
Upkeep of local areas/ street cleaning
Tourism marketing and development of the tourism sector
Business support
Organising local events, festivals, and attractions
Investment in local facilities (e.g. libraries, park areas)
Education and health
66% 32% 10% 40% 27% 7% 40% 23% 35% 12%
Training in tourism skills
Maintaining and promoting the use of the Welsh language
The priority was clearly local services, facilities, and infrastructure, which would support both the local community and the needs of visitors.
Late Payments and Procurement
48% of businesses experienced late payments in the past year, with 87% of experiencing late payments from the private sector and 25% from the public sector.
Of those who have ‘won public contracts’ 46% experienced late payments from the public sector. While the number of respondents who won public contracts is low at 39 responses, this difference does suggest late payments remain an issue in public sector with almost half of these having experienced late payments.
Of the wider 42% of respondents who had or were interested in public contracts, the breakdown is as follows:
• Yes, I have won public contracts: 34%
• Yes, I have tried but was unsuccessful: 29%
• No, I am interested but don’t know how: 37%
The existence of a pool of businesses interested in public contracts but unsure how to proceed suggests opportunities for policy intervention and improved publicity. It also illustrates an opportunity cost as there’s a pool of suppliers the public sector is missing out on engaging effectively, potentially harming competition and weakening value for money.
58% of businesses have no interest in public contracts, which explains why most late payments come from the private sector – but this is NOT because there are no issues with late payments in the public sector.
Of those who tendered, 10% found the process ‘smooth and clear,’ 45% found it ‘a little challenging but satisfactory,’ and 42% found it complex and difficult to navigate. For the latter group, the primary reason was overly complex paperwork and processes. However, this group represents a small subsample of 50 businesses and so should be treated with some caution.
When excluding ‘don’t know’ responses (48% of the sample), 99% of respondents believe procurement spending is insufficient for small and micro businesses.
59% of respondents feel that local authorities do not effectively communicate procurement opportunities to local businesses. When excluding the 37% who responded with ‘don’t know,’ this figure rises to 94%.
There was some regional variation in access to public contracts, which we will analyse in the section on regional variation.
One area that is important to note – albeit with some caution – is on public contracts and gender. The women in the sample accessing public contracts (6%) was substantially lower than men (21%). 14% of women have tried and failed (11% males), and a further 16% said they would be interested but don’t know how (this is the same for men). This is a worrying statistic as it seems businesses run by men are 3 times more likely to have gained public contracts.
It should be noted that this may be partly explained from the sectoral breakdown by gender. For example, 66% of food & accommodation sector in survey are women, and this sector is less likely to bid for public contracts, with 85% saying public contracts are irrelevant for them. Similarly, women were more likely to be self-employed another group less likely to bid for public contracts. Men were more likely to be in the ‘professional, technical and scientific’ sector, which correspondingly were more likely to access public contracts.
However, this variation does not account for the whole problem, and it is something that public sector contractors should explore in more detail, and of course there is a need to support women into business across all industry sectors.
Staffing and Skills
We asked whether businesses expect their staffing to increase or decrease in the next year:
Q17 Do you think you will employ more staff, fewer staff or about the same number of staff in 12 months from now?
The top 4 challenges to recruiting and retaining staff were as follows:
35% 30% 30% 26%
Lack of confidence in sustained customer demand to justify staff hours or hiring more staff
No current staff and no plans to employ
Inability to offer competitive wages
Shortage of available local workers
When asked if they engaged with schools and colleges on careers and recruitment, 70% of respondents said no, 18% said yes, and 13% said they had tried but received no response. The latter aligns with feedback from our research roundtables.
Export
Exporting businesses tend to be growing businesses, and encouraging suitable businesses to export is key to the government’s economic growth and productivity strategy.
As expected, 65% of respondents do not export and have no interest in doing so, while. The 10% who are not exporting but are interested represent a key
constituency for this area. While we do not expect all businesses to export, identifying this target group is valuable. However, the numbers who export are low and so the findings here are indicative only and should be read alongside wider data on exports in general.
For those who export, the top five countries for export are:
62%
Note that the response sample here is very small (47), as exporters represent a small portion of the full sample.
Of those who are exporters, have exported, or would consider exporting (88 responses in total), the top five support mechanisms they believe would help them are:
• Business support within a specific foreign market to help sell goods or services (e.g. market intelligence, links to local experts, navigating local regulations): 51%
• Funding for specific activities (e.g. tradeshow attendance, translation): 32%
• Visits to target markets: 31%
• General information on how to start exporting and available resources: 28%
• Legal support for issues that arise: 20%
Despite the small sample, the views of exporters and considerers are important – export is strongly linked to growth firms and developing new markets. It is also important to move suitable SMEs toward export – ‘Internationalising Welsh SMEs’ as we titled our previous report on export.
Environment
Only 19% of respondents had not taken any of the options listed to them to reduce their environmental impact.
In terms of adaptations, businesses have taken the following steps:
Waste reduction
Using EV or hybrid vehicle(s)
Installed zero/low emissions heating
51% 15% 22% 14% 49% 15% 17% 9%
Tenant - not been able to make adaptations
Minor adaptation – e.g. less energy use, efficient lighting
To encourage further action, the top five measures identified as most helpful would be:
• Grants to install energy efficient technology: 67%
• Lower energy bills: 59%
• Tax bill reductions: 38%
• A ‘green’ discount on business rates: 38%
• Improved access to advice and support from energy providers, brokers, or the government: 21%
Regarding how well supported smaller businesses feel, 24% have received support (two thirds of whom said they ‘would like more support’), 41% say they need support on net-zero transition. 35% report having had ‘no support’ but would like support in future, rising to 39% for high street businesses.
Increased insulation
Installing EV charger(s)
Other
There were many comments on this topic. A small minority were sceptical of net zero, but many also highlighted additional steps taken that were not listed, suggesting that what is suitable and effective may depend on the business sector and circumstances and is not easily captured in a list of options.
There is therefore a substantial amount of businesses who would want support or more support in this area, and there is an untapped group of businesses for business support in this policy area.
Transport
Unsurprisingly, and consistent with FSB surveys over many years, private cars are by far the most important mode of transport, followed by trains, walking, and buses. The data is as follows:
Q36 Which of the following modes of transport are important to your business? Please choose all that apply
Given the importance of cars (as well as deliveries, etc.), it is unsurprising that the quality of roads is the most important issue. The top five transport issues for businesses are as follows:
of
Regional and Geographic Differences
The results for Wales as a whole provide the foundation for policy decisions in this area. However, the Welsh business environment is not a monolith and we need to dig deeper into any variations, but with awareness that the deeper one digs the lower some of the samples and so we try to group these in a way that provides most confidence in the findings. Nevertheless, these should be viewed with some caution and treated as indicative, and some findings are presented with more confidence than others.
While few sub-samples vary substantially from the wider analysis – the story is really that most businesses view things similarly – there are nuances and changes of emphasis to be foregrounded. This is particularly so when the impetus is for Wales’s economic governance to move to a regional model, where we need also to understand variations in rural vs urban, as well as different types of businesses, and different pressures and exclusions that different types of employers face.
While important, we do note that segmenting the data and looking deeper necessarily means that the samples are smaller, and so we do note that caution is needed while reflecting that it is important to try to grasp the different needs of SMEs in Wales. We have therefore indicated the sample sizes in these sections and noted in the analysis accordingly.
Rural and Urban Local Authorities
We wanted to look at whether there was any variation between rural and urban – we looked at filtering by the 9 rural local authorities.
The general issues viewed as important tracked the same as across all businesses and so this should not be viewed as separate, but only noting where there was a difference in emphasis. It should be noted that clearly there are rural areas in ‘urban’ authorities and vice versa, and so many businesses will be the same.
Rural areas were somewhat overrepresented – which tracks with the demographics of how micro businesses are more key in these areas, but also means there is a meaningful sub-sample of 177 businesses, or approximately half the wider sample.
Rurality and Key variations
The rural businesses were much more likely to be in Food & Accommodation sector (31%; this was 16% for ALL business), and less likely to be Professional, Technical and Scientific services. This reflects the sectoral make up we know pertains in these areas and so indicates a good quality sample.
When looking at plans for next two years, ‘developing a succession plan’ was higher at second place than in the wider group (where it is 3rd)
This rural cohort was notably more pessimistic on the Welsh economy than the wider sample, with index score of 2.07 vs 2.22. This makes it seen as lower than the other options given by some distance (including UK economy and Global economy).
While the top 2 interventions that could positively impact on their business was the same as the wider sample (tax, and simper regulation), it is notable that ‘reliable access to superfast broadband’ was 3rd place for Rural businesses (7th for ALL businesses) and seen as much more important with 24% putting it as one of their key concerns.
‘Better transport infrastructure’ was also more important to the rural LA based businesses by comparison, coming in at 4th rather than 6th. In responses another question, ‘Low frequency of public transport’ (48%) is top issue affecting their business. For ALL businesses, 41% put this as a priority – ‘road maintenance’ was a more important intervention for the wider sample. Public transport issues are more of an issue in rural areas in our sample.
On business rates, the same two options for intervention were the top two as ALL businesses (‘incentives for high streets’ and ‘reliefs automatically applied’ respectively). However, 3rd is permanent relief for specific sectors – probably reflecting that in the rural sample there is a higher proportion of ‘food and accommodation’ businesses who may be beneficiaries and would more likely support this.
Self Employed
84 respondents said they do not employ staff. As such the sub-sample is not large, but it is useful in terms of where there are answer that diverge from the full sample in illustrating different priorities.
On most issues, this tracked the wider cohort, albeit with some areas of less relevance (such as on staff policies), and some differences in terms of demographics and priorities.
37% of this sample was 65+, as against 21% in the general sample.
Notably, 37% of these said ‘access to business support’ would be one of the priorities that would impact positively on their business (ALL - 26%). As with the general responses, this was 3rd behind ‘lower tax’ and simpler regulation but more putting as a priority suggests a need for self-employed who are probably more stretched across different business elements.
Comparatively fewer of this cohort experienced late payments, with 26% saying they had done so in the last year, compared to 48% of all respondents.
Fewer had engaged with schools and colleges at 9.5%. Whether this is due to time of self-employed, or whether schools are not looking to bring in entrepreneurs to discuss with students is something that may be explored further.
Only 5% had won public contracts. A further 10% had attempted to do so and a further 20% would have an interest. This indicates that contracts need to be better shaped for self employed and that they are given information and tools to do so. Essentially this is a similar issue as micro businesses, only more so in terms of challenges of time and costs, and in terms of contracts being shaped so this cohort can compete or can feel that they have an opportunity that is worth the time commitment to compete.
Differences by Geography
With Wales’s economic governance moving towards a regional footprint, we decided to filter the data according to regional groupings of local authorities. This is a useful exercise as following work by OECD, the new CJCs and Local Growth Fund are moving to regional strategies and market needs, aligned the City and Growth Deals being based on that spatial level. As such understanding different needs would help at these decision-making levels at the regional level.
As such we filtered by Mid Wales, North Wales, South East, and South West Wales. The sample varied across those areas due to relative size and population, so some are more indicative than others with better samples.
Cardiff City Region / South East Wales
Understandably this region had the highest sub-sample 136. 44% of respondents’ businesses in the region were based in Cardiff.
In terms of sector, there are many more ‘Professional, scientific and technical businesses’ in this area than ALL Wales – 30% of respondents (20% ALL). There were notable fewer accommodation and food sector represented.
Interestingly - ‘It gives me control over my work and/or work patterns’ at 44% was scoring relatively higher on reasons to be in business (behind make money on 47%; and ‘work in interesting field’ on 66%). This shows that there are many reasons for running a business and that it’s a positive choice for our respondents. Autonomy and passion for the work are important as well as (rightly) to make money, including in this region.
South East Wales was the only area more optimistic on Welsh Economy (2.39) than UK Economy (2.28) –Welsh economy was lowest of options given in all other areas.
In the next year 19% of the region aim for rapid growth, and 45% expect moderate growth (up to 20% per annum), which is more aiming for growth than other regions. 30% expect to employ more next year vs 14% employing fewer. This is notable higher looking to grow employment than other regions.
61% had experienced late payments in the last year –this was the highest area for this. It is also notable that 30% of these from public sector – far higher than ALL respondents.
Significantly – this region is also higher for accessing public contracts at 23% (notably higher than mid and north Wales at 9-10%. This supports our inference above that late payments is an ongoing problem in the public sector. A further 14% of respondents have tried and not won contracts, and a further again 17% have not tried for public contracts but would be interested in doing so. So, 55% have won, have tried or would like to access public contracts in this region - this is much higher than other regions.
This suggests that public contracts are an important part of building prosperity and building local businesses in South East Wales – this needs to be expanded for SMEs in this area, but elsewhere too.
Perhaps surprisingly figures for export (18%) broadly track ALL (17%), except 15% are interested in export but don’t at present (11% for ALL) – even that is similar.
In Transport congestion was noted as relatively more important than other regions 37% vs ALL=28%)but otherwise the broad issues identified were the same.
North Wales
The next largest sub-sample size is North Wales, at 114. Gwynedd is relatively overrepresented, and Anglesey has fewest responses of the local areas grouped together. However, there is a relatively equal mix across urban and rural Local Authorities in terms of sample size.
In terms of policy the top 5 is broadly the same as elsewhere, but ‘Improving digital infrastructure and skills’ is higher at no 5 (this is 12th for ALL businesses across Wales).
There was substantial amount of ‘Other/Comments’ in this region saying to ‘scrap the tourist tax’ and to ‘change 182 day rule for holiday accommodation’ and ‘proactively support tourism’ (in broad terms covered elsewhere ‘tax and regulation’ but clearly these businesses felt need to add in comments for their specific sector).
Another difference is on issues where they felt support could make a difference, with ‘access to business support’ at number 3 at 23%, alongside all areas outside South East Wales, this is relatively higher than across all respondents – it may be that some support facilities are more sparse in some areas than others, and there may need to be gap to be filled that does not exist in the more urbanised South east for example. This tracks too with the rural local authorities variations.
On skills ‘Absence of available local workers’ was higher than ALL at 2nd place (31%; ALL – 26%).
On Public contracts only 9% of respondents in North Wales said they have won public contracts. 13% have tried and failed, and 13% on are interested but don’t know how.
Swansea City Region / South West Wales
The sub-Sample of this region is 74 responses and so findings should be treated with caution.
Response here are skewed to Carmarthenshire (36%) and Pembrokeshire (33%) and underrepresented by in Swansea (24%) and NPT (18%) respectively. So, this is ‘rural’ skewed and it is plausible that findings for those areas are better understood through the rural vs urban analysis above.
Relatively fewer are aiming at rapid growth (4%) but 47% aiming at moderate growth and ‘Developing a succession plan’ is the main option they want to develop in next 2 years.
The index score for the Welsh economy is particularly low in confidence at 2.03 - the same score as we see in North Wales, and is notably lower than south east Wales.
As in North Wales – access to business support is number 3 below tax and regulation as intervention the think ‘would have the largest positive impact on your business performance’, again indicating outside CCR that there are more support functions that may need to be filled that aren’t available in those markets.
A notable finding is that more businesses in this area expect to shrink than grow on employment (14% grow / 20% fewer employees) – while a relatively small sample this tracks with wider surveys this last year, and is likely more of an issue in these areas.
79% of respondents in this region are against a Visitor Levy in their local area.
On Public Contracts - Only 10% have won public contracts, a further 10% tried and unsuccessful, and 13% would be interested but have not attempted. 67% have no interest in public contracts.
95% say their car is important to their business – this is high everywhere, but particularly so in this region. Road maintenance is the main transport priority (55%; ALL=44%), with ‘frequency of public transport’ the second priority at 39%.
Mid Wales
Understandably, with only Ceredigion and Powys in the region, this region produced a particularly small sample of 32. The findings tend to track with the wider ‘rural areas’ analysis which supports the findings, and given the wider sample size for the ‘rural areas analysis’ so it is safer to use the analysis across the 9 rural local authorities for this area.
For example, it is worth noting that ‘improvement to public transport infrastructure’ was higher than the ‘All Wales’ response coming in as a 2nd priority. This aligns with the finding in the wider sub-sample analysis for ‘Rural areas’ and so is a safe finding.
Notably ‘access to broadband’ and especially ‘access to mobile data’ were higher in this area than general sample, at 3rd and 4th respectively.
Conclusion
The Big Small Business Survey for Wales reveals a clear picture of the challenges and aspirations facing small businesses across the nation. While only 10% of respondents expressed optimism about the Welsh economy, with 63% feeling pessimistic, a encouraging 52% remained optimistic about their own business prospects. This contrast highlights the resilience and determination of Wales’s SMEs, who continue to drive local employment, innovation, and community vitality, despite broader economic challenges.
SMEs have identified clear priorities for action. Lower business taxes, including National Insurance and business rates, emerged as the overwhelming top concern, selected by 72% as the issue most likely to positively impact performance. This was followed by better and simpler regulation (39%), improved access to business support (26%), appropriately skilled staff (23%) and access to finance (22%). On business rates specifically, businesses called for incentives and reliefs for town centre locations (55%), automatic application of eligible reliefs (46%), a shift away from propertyvalue-based taxation (40%) and permanent additional reliefs for specific sectors (39%). Views varied by region, with South East Wales showing greater relative optimism about the Welsh economy compared with other areas and rural businesses placing higher emphasis on issues such as reliable broadband, public transport and sector-specific support. High streets remain a significant concern, with a majority viewing them as bleak or bad, and strong support for measures to fill empty properties and regenerate town centres.
Other key themes include opposition to the Visitor Levy (64%), ongoing issues with late payments (experienced by 48%), barriers to public procurement, recruitment challenges, limited exporting activity, steps already taken towards environmental improvements and reliance on private cars amid concerns over road quality and public transport.
In summary, Wales’s small businesses are aspirational, passionate about growth and clear about the practical support they need to thrive. Taxation and regulation reform, particularly around business rates, stand out as the most pressing levers for unlocking potential. The next Welsh Government, whatever its composition after the 2026 Senedd election, must prioritise these issues to build stronger foundations for economic growth and prosperity. By addressing the core concerns voiced in this survey, policymakers can empower SMEs to drive employment, innovation and wellbeing across all communities in Wales. FSB Wales stands ready to work with all parties to ensure the voice of small businesses shapes a positive future for the Welsh economy.
