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Joint Press Release with the Organization for Small and Medium Enterprises and Regional InnovationSmall and Medium Enterprise Agency The 135th Survey of SME Business Conditions (January-March 2014)

The Survey of SME Business Conditions is a quarterly survey conducted by the Organization for Small and Medium Enterprises and Regional Innovation, targeting about 19,000 small and medium enterprises (SMEs) across Japan in cooperation with business management advisors of the societies of commerce and industry, and chambers of commerce as well as researchers of the National Federation of Small Business Associations.

The Small and Medium Enterprise Agency and the organization jointly compiled the business achievements (DI) of SMEs in the January-March 2014 period and the forecasts (DI) for the April–June 2014 period concerning SME business conditions, sales amount, ordinary profits and other elements. They hereby release the results.

1. Key survey results

The recent business conditions of small and medium enterprises are moderately picking up.

  • The business conditions DI (diffusion index) of all industries showed a decrease in the negative gap.
  • Looking at the business conditions DI of each industry, the negative gap of the manufacturing sector decreased for the sixth consecutive quarter, and that of the non-manufacturing sector also decreased for the second consecutive quarter.
  1. From January to March 2014, the business conditions DI of all industries improved by 2.7 percentage points from minus 13.8 in the preceding quarter to minus 11.1, which means that the negative gap decreased for the second consecutive quarter.
  2. The business conditions DI of the manufacturing sector improved by 4.1 percentage points from minus 6.7 in the preceding quarter to minus 2.6, which means that the negative gap decreased, marking a record high level. Looking at the business conditions DI of each industry, the positive gap increased in five industries, including the iron & steel and non-ferrous metals, furniture and fixtures, and lumber and wood products industries, while the negative gap decreased in six industries, including the chemicals, ceramic products, soil & stone products, and other manufacturing industries, among which two industries, namely, chemicals and ceramic products, soil & stone products, turned to a positive value. The negative gap increased in three industries, namely, the pulp, paper and paper products, food, and transport equipment industries.
  3. The business conditions DI of the non-manufacturing sector improved by 2.1 percentage points from minus 16.1 in the preceding quarter to minus 14.0, which means that the negative gap decreased. Looking at the business conditions DI of each industry, the negative gap decreased in all four industries of the construction, wholesale, service, and retail sectors, among which the construction industry showed an increase in the positive gap.
  4. The financing DI of all industries improved by 1.9 percentage points from minus 14.1 in the preceding quarter to minus 12.2, while the DI measuring long-term financing difficulty improved by 0.4 percentage points from minus 7.1 in the preceding quarter to minus 6.7, which means that the negative gap decreased. The DI of short-term financing difficulty also improved by 0.5 percentage points from minus 4.4 in the preceding quarter to minus 3.9, which means that the negative gap decreased.

2. Topic

In this quarter, the positive gap of the materials/goods purchase unit prices DI (“increase” to “decrease” on a year-on-year basis) increased for the fifth consecutive quarter, by 3.4 percentage points from 36.0 in the preceding quarter to 39.4, while the unit sales price/per-customer sales DI (“increase” to “decrease” on a year-on-year basis) improved by 2.4 percentage points, from minus 14.9 in the preceding quarter to minus 12.5, and the profit (ordinary profit) DI (“increase” to “decrease” on a year-on-year basis) improved by 2.5 percentage points, from minus 25.1 in the preceding quarter to minus 22.6, which means that the negative gaps of the three DIs decreased. However, a price increase in raw materials and other factors due to the depreciation of the yen should be closely and continuously monitored.

Note: The DI is calculated on a seasonally-adjusted quarter-on-quarter basis unless otherwise specified.

For details of the results, see Appendix(PDF:786KB) PDF File (in Japanese).

Release Date

March 27, 2014

Division in Charge

Research Office, Policy Planning Division, Business Environment Department, Small and Medium Enterprise Agency

Business Support Information Center, Organization for Small and Medium Enterprises and Regional Innovation

Ministry of Economy, Trade and Industry
1-3-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8901, Japan Tel: +81-(0)3-3501-1511
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