New study shows: Optimism among SMEs is waning

Published for the sixth time by Kearney and its partners Raiffeisen, swiss export and Angst + Pfister AG, the SME survey provides an insight into the current situation, challenges and opportunities for SMEs. 382 representatives of Swiss SMEs were surveyed in the period from May to the beginning of July 2023.

Optimism among SMEs has declined

The focus of the survey was on the resilience of SMEs in the current challenging environment. According to Kearney partner in Zurich Fabian Siegrist, the majority of SMEs are considered resilient or very resilient to the current crises. However, raw material and energy prices coupled with the shortage of skilled workers are causing entrepreneurs great concern.

After the very optimistic outlook of SMEs in last year's survey, this optimism is fading in this year's survey. The reticence of SMEs is reflected, among other things, in their financial expectations. Only half of the companies surveyed now expect sales to rise this year, compared with 63 percent (2022) and 69 percent (2021) in previous years.

Roger Reist, Head of Corporate Clients, Treasury & Markets and member of the Executive Board at Raiffeisen Switzerland, describes the headwinds currently facing SMEs as great: "The goods demand boom created by the pandemic has finally run its course, and consumers are instead spending more on services again. On the other hand, industrial demand is being weighed down by stubbornly high inflation and rising interest rates. Nevertheless, the study confirms that a large proportion of Swiss SMEs are once again proving their resilience."

Large differences in resistance

Given the numerous and complex challenges SMEs face in their day-to-day business, the study examined how SMEs respond to crisis situations in order to mitigate the effects of crises, prevent them altogether or even benefit from them. For SMEs, satisfied customers and employees are the key metrics by which their own resilience is measured, followed only by financial metrics. Only 19 percent feel well prepared when it comes to the shortage of skilled workers. According to the study results, the SMEs surveyed have taken numerous measures to strengthen themselves against challenges and crises. Process adjustments, which also include the digitization of processes, rank first. This is followed by investment in innovation and adaptation of customer and pricing strategies. Claudia Moerker, Managing Director of the swiss export association, notes that many companies have optimized their supply chains to meet consumer demands and kept inventories as low as possible to save costs.

Economic risks weigh on outlook

For the next three years, 62 percent of companies still expect their own company to perform well to very well, compared with 67 percent in 2022 and as many as 76 percent in 2021. The successive crises and challenges have thus left their mark on SMEs. As in the previous year, the SMEs surveyed identified the high energy and raw material prices, access to skilled workers and personnel, and once again the unclear bilateral relations between Switzerland and the EU as the greatest economic risks for the next twelve months. Since the failure of the framework agreement with the EU, little has changed in the bilateral relationship between Switzerland and the EU. For this reason, around half of the companies surveyed continue to call on politicians to find a solution to the EU issue. It is clear from the study that the importance of this concern increases with the size of the company. In view of the worsening shortage of skilled workers, the demand for securing the need for skilled workers and ensuring attractive framework conditions and further location promotion is increasing compared to previous years.

The "SME SME Study", which has been conducted since 2018, provides an annual assessment of the situation of Swiss SMEs.

Source: Kearney