SCOTTISH companies are on average more optimistic about their growth prospects over the next five years than their peers anywhere in the UK outside London and the south-east, even though they are much less bullish than in 2011.
A survey of companies with an annual turnover of up to £20 million, published today by banking group Santander, shows the average business in Scotland is projecting growth in turnover of 91% over the next five years.
This is ahead of the average UK company's forecast of an 88% increase in sales over this period.
Although the average Scottish company's growth projection is adrift of figures of 153% for Greater London and 140% for the south-east, it is much greater than forecasts of 70% for both Wales and the south-west, 68% for the East Midlands and East Anglia, 56% for the north-east and Yorkshire and Humberside, and 49% for the north-west and West Midlands.
However, Scottish companies had been the most optimistic anywhere in the UK in the same survey a year ago, when they projected 194% growth in turnover over a five-year period.
The average UK business last year projected growth of 104% on a five-year view.
However, Santander noted the average 91% growth projected by Scottish companies over the next five years was equivalent to an increase of about 14% per annum, taking into account compounding effects.
And, even though Scottish companies' growth projections have tumbled since last year, 46% of firms north of the Border which were surveyed believe their businesses have never been in better shape. This compares with about one-in-five companies reporting such a belief UK-wide.
The survey, conducted by UK market researcher BDRC Continental for Santander, involved 502 companies in the UK. Of these, about 50 are in Scotland.
Graham Silcock, regional director for Santander's corporate banking division in Scotland, said: "It is great to see that Scottish businesses remain very optimistic about their growth prospects over the longer term and even better to see that nearly half describe themselves in fantastic health, an indication that Scottish business owners have been working hard at managing their businesses through the UK and global economic uncertainty. Many people think survival is about holding onto their cash but, in order to promote longer-term growth, businesses need to continue to invest.
The Federation of Small Businesses, when asked whether its dealings with its membership base pointed to greater confidence about expansion prospects among companies north of the Border, signalled they did, to some extent.
Colin Borland, head of external affairs in Scotland for the FSB, said: "It is interesting because it does chime with some of the results we have had back from our confidence index studies. They tend to show that Scotland is more positive than other areas, especially among the devolved areas, Wales, Northern Ireland, and even London.
"We seem to be doing better on our figures."
But Mr Borland highlighted the very different experiences of Scottish companies, depending on the sectors of the economy in which they were operating.
He said: "There is wide variation within that. If you are in any industry that relies on discretionary consumer spending or is allied to the housing market, you are going to find things difficult."
Asked which firms had a more positive outlook, Mr Borland highlighted "some younger businesses" which had not known anything but difficult economic times. He said: "If they are three or four years old, they have known nothing but the age of austerity. They are maybe more used to trading in difficult circumstances."
Mr Borland, while noting he was generalising, added: "Everyone is getting squeezed, everyone is getting pushed for better value and lower prices. The ones that seem to be (faring well) are the ones that seem to be offering something special, something extra, the personal touch or specialist advice."
The survey, conducted earlier this summer, also showed 27% of Scottish businesses believed staff morale had improved because of the Olympics. Some 36% believed the Olympics had had a more positive effect on their business than they had expected. Only 5% believed annual sales would improve due to the Olympics.
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