Business confidence slips back

Filipino business confidence has slipped back 6 index points to 136 since September, according to the global Regus Business Confidence Index. Companies reporting revenue growth decreased, reaching 56 percent compared to 63 percent six months ago. Companies reporting profit growth (50 percent) also fell 7 percentage points.

Mindful of the need to contain costs in the quest for sustainable growth, businesses identified a shorter supply chain, increasing use of flexible workspace and greater use of cloud IT applications as the most effective cost-cutting measures for the coming months.

Looking back, Filipino firms identified making permanent staff redundant (50 percent) as the main reason for corporate distress during the downturn, followed by paying for unnecessary office space (46 percent).

Respondents identified a shorter supply chain (51 percent), increasing use of flexible workspace (49 percent) and greater use of cloud IT applications (42 percent) as the areas where companies could best make savings without damaging growth prospects.

Filipino firms reported that a wider distribution of customers (47 percent) and increasing flexible workspace (35 percent) would make the greatest contribution to enhancing future business stability as a platform for growth.

Globally, the Business Confidence Index rating was lower for small businesses (107) than for large firms (124).

Wiliam Willems, regional vice president of The Regus Group for Australia, New Zealand and South East Asia said: “Although untouched by the significant setback reported by the index in other global economies between March and September 2011, Filipino business confidence has now suffered a slight dip.