Confidence among Scotland’s small business community has risen to its highest level for a year, according to a new report.
Firms that took part in the FSB’s quarterly Voice of Small Business Survey were also optimistic about job creation in the next quarter the first time a positive outcome had been recorded since the study was first launched in the autumn of 2010 while 10% of survey participants said they expected revenues to grow in the next quarter.
The study found a marginal improvement in the availability of finance, while fewer companies were finding the costs of credit unaffordable. Although there was a general upturn in mood, the FSB survey found the economic prospects for the Scottish small business sector still lagged someway behind the wider UK outlook.
Confidence north of the border was +9 for the quarter, 6.9 points less than across Britain as a whole.
A quarter of Scottish businesses were found to be battling against increased costs in the period higher utility bills were reported by almost 60% of respondents and a balance of 17% of companies said they had seen their profits squeezed.
Despite the easing in available credit, the investment intentions of firms weakened in the quarter to 8%, down from 10% a year earlier.
Federation of Small Business Scotland policy convener Andy Willox said there were tentative signs of recovery within the sector.
“For the first time in a long time, things are looking noticeably brighter,” he said.
“Of course, it’s all relative and we are coming from a very difficult position, but it’s great that small businesses are feeling more confident and getting ready to expand their workforce.
“Confidence and jobs are the two key ingredients of any recovery.”
Meanwhile, research by KPMG found evidence of a new “shareholder spring” over pay for senior management among angry investors in small cap firms.
The analysis found that 16% of such firms in Scotland were rocked by significant shareholder dissent when it came to voting on the remuneration report.
Eddie Norrie of KPMG Scotland said: “Where we have seen shareholders objecting, it’s been similar to last year in that the dissent relates to specific circumstances and issues.
“These are usually not solely pay related, but instead driven by a combination of dissatisfaction around corporate performance and the leadership of the business.”