UBS SME barometer: uncertainty for companies

The business position worsened between April and July both for SMEs and for large companies, whereby the decline hit SMEs harder. With the exception of SME returns, all indicators in the said period of time worsened for both categories (order receipts year on year; return in the last three months and expectation of prices over the next three months). The decline of order receipts compared to the previous year was particularly marked - irrespective of company size. Generally, large companies rated the economic situation somewhat more pessimistically than the SMEs.

There is little sign of any poor sentiment in the services sector. The business position for the large companies and SMEs improved between April and July. SMEs are actually slightly more optimistic, which is shown both in the business position and in expected prices. They anticipate slightly higher prices over the next three months. Large companies are, in contrast, slightly more pessimistic and anticipate falling prices in the same time period. Demand improved slightly for both company sizes.

There was a mixed picture in the construction industry. For the large companies, the economic situation worsened slightly, while the position for the SMEs improved slightly. As it was just the demand that improved, margins for large companies remain under pressure. The large companies are also assuming that prices will increase over the next three months. In contrast to the SMEs, they expect prices to fall over the next three months. For SMEs, the demand admittedly improved, but returns were slightly down over the last three months.

The business position for architecture and engineering firms was at a very high level in July. While the business position for large companies (which in general also rated the overall situation more positively) improved once more, a slight decline for SMEs was observed. Despite the generally good sentiment, the returns situation worsened for large companies; expectations concerning price behavior over the coming three months are negative. In contrast, SMEs were more optimistic concerning price expectations and the returns situation also improved marginally between April and July.

For retailers, the picture was a mixed one. For large companies, all indicators worsened between April and July; for SMEs, however, they improved within the same period. The business position was in fact rated good for both company sizes, but at a somewhat lower level. Margins as well as prices remain under pressure. The current strong Swiss franc is likely to exacerbate this situation as well.

Although the economic situation in wholesale for both company sizes continues to be rated as good, sentiment deteriorated between April and July, particularly for large companies. Both demand and returns fell. However, there is a prevailing sense of optimism here concerning the development of prices over the next three months. For SMEs, all indicators worsened, the fall in returns was particularly marked.

In tourism, the situation improved for large companies and SMEs. Demand, the returns situation and also the business position improved between April and July for both company sizes. Companies were also optimistic about future price behavior. The current strong Swiss franc therefore had little influence on the number of guests, most likely because many travelers had already booked in advance. In general, however, large companies rated the economic situation better than the SMEs. This was not only seen in the business position, but also in other indicators.