Both domestic and export orders drop in SME manufacturing sector

Both export and domestic orders among SME manufacturers in Britain fell in the three months leading up to October according to the latest report of SME Trends. The survey that is published on a quarterly basis looks at 362 SMEs that are based in the UK.

It found that new orders decreased by a stunning 13% with many of the smaller manufacturers struggling to attempt to sell overseas goods at the same time that export orders dropped by an even higher 21%. This was the largest drop recorded since July 2009.

Other factors that will likely hurt the export market for SMEs over the next few months include problems with political conditions abroad and delivery dates. Optimism also fell by about 18% as most SMEs stated that they believe their export prospects are going to decrease.

Policy adviser at the Forum of Private Business, Robert Downes, stated that late payment is one of the largest barriers that are in front of small business. Banks are not able to lend in the amounts that small businesses need which is making the problem even larger because SMEs are not able to borrow any more cash that will help to offset their cash flow issues.

The CBI report also found that production fell overall by about nine percent, but it is expected to rise back up by around five percent by the end of the last quarter. SMEs also reported that their employment figures did not change during October, but they do foresee many jobs cuts ahead in the next few months that will no doubt hurt their overall performance.