Small Scottish firms remain keen to invest in their future but are not turning to the banks to help them with finance.
Latest research from the Federation of Small Businesses shows confidence rose during the first quarter of the year, but also showed that the aspirations of Scots businessmen and woman still lag behind their counterparts from the rest of the UK.
The FSB’s Business Index also showed confidence was down significantly on the equivalent measure at the same time last year.
Fewer senior managers are applying for funds from lenders, with only one in five asking for a loan in the last quarter.
Other findings included a guarded expectation that SME staffing levels would grow over the coming three months, while fuel and utility costs were said to be the key driver of increased costs.
FSB Scottish policy convener Andy Willox said the increase was welcome no matter how limited it was, but called for action on “spiralling” overheads.
“Small businesses operate in every community the length and breadth of Scotland,” he said. “An increase in small business confidence is, therefore, good news for all of us even if Scottish firms continue to be less positive than their UK counterparts and if we’re still behind where we were a year ago.
“Confidence is key to recovery and I am heartened to see that more small firms are planning to invest.
“That means more orders placed, more business being done and fewer suppliers looking nervously at empty order books and trimming staff costs.
“I hope more large businesses now follow our lead and start investing the significant sums on which they are sitting.
“However, businesses’ investment and growth intentions are being undermined by spiralling energy and fuel bills. We need more action in this area.”
The report also reveals that financial and business services firms were most upbeat, with retailers and manufacturers expecting conditions to deteriorate.
But in all, 16% of the Scottish firms surveyed as part of the study of 2,500 small businesses in membership of the FSB said they plan capital investment in the year ahead.
The index measured “business confidence” with a rating of -1.0 during the first three months of the year up on the -10.0 measure seen during the last quarter of 2012. The UK-wide equivalent figure was +6.3.