September 28, 2018
The Small and Medium Enterprise Agency
The Survey of SME Business Conditions is a quarterly survey conducted by the Organization for Small and Medium Enterprises and Regional Innovation, targeting approximately 19,000 small and medium enterprises (SMEs) across Japan in cooperation with business management advisors from commerce and industry, chambers of commerce, and researchers from the National Federation of Small Business Associations.
The Small and Medium Enterprise Agency (SMEA) and the organization jointly compiled the business achievements (diffusion indices, or DIs) of SMEs for the July-September 2018 period and the forecasts (DIs) for the October-December 2018 period concerning SME business conditions, sales amounts, ordinary profits, and other data.
Key point of the survey results
The recent business conditions of small and medium enterprises show moderate improvement, while progress in some industries appears to have paused.
The adverse impact resulting from a string of natural disasters and a scorching summer are considered important factors in business conditions over the period. SMEA will continue to pay close attention to the situation in order to determine if this impact will be temporary or not.
- From July to September 2018, the business conditions DI for all industries was -15.6 (down by 1.6 points from the previous quarter), having decreased for two consecutive quarters.
- The business conditions DI for the manufacturing sector was -10.5 (down by 2.0 points from the previous quarter), showing a decrease for the first time in two quarters. Looking at the business conditions DI of each industry, improvements were seen in three industries - printing, wood and wooden products, and textiles - while the DIs for 11 industries, including the iron & steel and non-ferrous metals, ceramic, stone and clay products, pulp, paper and paper products, electrical & information communication equipment and electronic parts, furniture and accessories, and machinery industries, decreased.
- The business conditions DI for the non-manufacturing sector was -17.2 (down by 1.3 points from the previous quarter), having decreased for two consecutive quarters. Looking at the business conditions DI of each industry, improvements were seen in the wholesale industry, while the DIs remain flat in the retail trade industry and decreased in the construction and service industries.
- The financing DI of all industries was -11.9 (down by 0.6 points from the previous quarter), showing a decrease for the first time in two quarters, while the DI measuring long-term financing difficulty and the DI measuring short-term financing difficulty were -3.0 (down by 0.3 points from the previous quarter), showing a decrease for three consecutive quarters, and -0.9 (down by 0.5 points from the previous quarter), showing a decrease for the first time in two quarters, respectively.
Division in Charge
Research Office, Policy Planning Division, Business Environment Department, Small and Medium Enterprise Agency