Although the current economic situation in the country and the results of recent months are assessed by small and medium-sized businesses (SMEs) as average, they expect better days in the near future, and some intend to increase prices. This was shown by the new index published for the first time by the financial technology company Inbank, designed to assess the economic condition of Lithuania. Small and medium-sized businesses (SMEs) are the foundation of the Lithuanian economy, accounting for over 99 percent. of all business entities in the country. They are the main employer, supporting regions and are often the first to feel market changes. Inbank presents the index, which will be updated every two months and will measure the sentiment and expectations of SMEs. The aim is to assess the country's economic health and business situation in real time. “The index will help to better understand business cycle trends, predict economic changes and respond to challenges or opportunities in a timely manner, thus providing valuable insights for both the business community and policymakers. Every two months, we will survey owners and managers of small and medium-sized businesses to have the most objective picture possible,” says Vaidotas Rimeikis, head of the Inbank branch in Lithuania. Hoping for better days The owners and managers of small and medium-sized businesses who participated in the survey in early March usually assess the current economic situation of the country on a ten-point scale with an average of 6.76 points, and the last 2 months of their business – even more modestly (6.17 points). However, expectations for business success for the next couple of months are much higher and reach 7.81 points out of ten. “The survey results show cautious business optimism. Although the beginning of the year is assessed as average, the future is viewed with higher spirits – some businesses expect market activation and better sales in the near future,” – comments on the data V. Rimeikis. However, all this also depends on the business sectors, where significant differences are evident. For example, companies engaged in housing installation, construction and technical goods more often provided higher assessments of economic and business prospects. At the same time, the scores provided by companies in the medical and some service sectors are more restrained. “This allows us to assume that segments related to the housing market are currently experiencing greater stability or recovering demand,” – notes the head of the Inbank branch in Lithuania. About a third plan to increase prices When asked what they intend to do with prices, entrepreneurs divided into two groups – some said they would not change them (37 percent), while others (30 percent) are considering increasing prices. The rest of the respondents say that they have not yet decided on prices for the coming months.
According to V. Rimeikis, this is a signal that businesses are still feeling cost pressure and are trying to maintain margins. However, it is likely that many will choose a restrained, safe pricing strategy in the near future, avoiding extremely aggressive price changes in the market. About the Inbank Small and Medium Business Index The survey conducted by Inbank every 2 months measures the sentiment and expectations of small and medium businesses in order to objectively assess the economic situation in Lithuania. Inbank partners participate in the survey.
