Confidence among small business owners in the South West is rising again, according to the latest survey from the FSB.

The Federation of Small Businesses (FSB) surveys its members about their future plans every quarter and the latest results show confidence levels bouncing back after falling in 2017. This is due to lower inflation, progress on Brexit talks and the government's positive Spring Statement.

And it is not only confidence that is rising. The proportion of firms planning to increase investment has hit a two-year high and half of the small businesses surveyed expect to expand operations over the coming 12 months. The survey also shows small firms are continuing to hire.

The news has been welcomed by Russell Warner, area lead for the FSB in Gloucestershire (pictured): "It is encouraging to see that, despite there still being a lot of pressure on small business, there is a rising sense of confidence and optimism among the businesses in this area."

More than a quarter of small firms in the South West expect their performance will either improve (31 per cent) or remain the same (40 per cent) over the next three months, while only three in ten (29 per cent) lack confidence about the coming quarter.

More than half of firms in the region (59 per cent) report that revenues are either stable or increasing and the proportion of firms planning to increase investment has reached 32 per cent.

But it's not all good news. Consumer demand (43 per cent), appropriately skilled staff (39 per cent) and labour costs (21 per cent) are the other most frequently flagged barriers to growth among small firms in the region.

Mike Cherry, FSB national chairman, said: "The resilience of the small firms and self-employed entrepreneurs that make up 99 per cent of UK businesses has lifted economic forecasts for the coming 12 months.

"The picture is mixed though - consumer-facing firms are still trying to keep their heads above water after a year of customer belt-tightening and business rates hikes. As a labour-intensive industry, small firms in the retail sector will disproportionately feel the impacts of a rise in the national living wage and auto-enrolment contributions next month."

Punchline says: "Here at Punchline we always champion small businesses and fight their corner and it's good to read that small firms are feeling more positive. But this is not the feedback we've been getting, especially from the retail  and hospitality sectors . We've been out and about delivering our magazine from Bourton-on-the-Water to Wotton-under-Edge and chatting to businesses and the message we're getting is that it's still tough out there."

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