These findings are from the Business Barometer study by Novuna Business Finance, which has been tracking small business growth forecasts every quarter since 2015.

The latest study asked small business owners about their growth forecasts for the final three-months of 2025, going into the Christmas period (1 October to 31 December 2025). The findings reveal that small business growth forecasts in Scotland have fallen in consecutive quarters since the start of the year.

Percentage of Scottish small businesses predicting growth

The new Novuna Business Finance data also reveals a rise in the percentage of Scottish small business owners that fear contraction or collapse (24%) in the next three months – a rise since the start of the year (17% for Q1 2025).

Added to this, 91% of Scottish small business owners say they fear the possibility of Autumn Budget announcements that could negatively impact their growth outlook and finances.

Industry Sector findings:

• Nationally, in every industry sector, the percentage of small businesses predicting growth is down on the position at the start of the year. 
• Growth forecasts in construction (17%) are at their lowest point since Q2 2024.
• In retail, there are no signs of the Christmas countdown boost to business confidence of recent years. For 2025, the percentage of small business owners predicting growth is flat on the summer months, and significantly down on the start of the year (25% Vs 33% in Q1 2025).
• The hospitality and leisure sector sees the percentage of small businesses predicting growth (23%) fall to its lowest level since Q1 2021.
• The percentage of business owners predicting growth in the agriculture sector has halved since the start of the year (falling from 40% to 19%) - and now stands at its lowest level since Q4 2022.
• Despite the extremely challenging market conditions, growth forecasts in the manufacturing sector remain relatively flat on Q3 (25%) and are down only slightly on the start of 2025 (27%).

Percentage of small businesses predicting growth by industry sector:

Start and end of year comparisons

Jo Morris, head of insight at Novuna Business Finance, said: “Whilst Scottish small business growth forecasts are down this year, the underlying concern is the ongoing slide over consecutive quarters.

“The value of our decade-long tracking research indicates that developments in 2025 are significant: this spring, the percentage predicting growth dropped below 30% for the first time in years and, since then, it has continued to fall.”

Ms Morris continued: “There are various factors at play. Market uncertainty is something small businesses do not like, US tariffs have been a cause of concern through 2025 and, for many small businesses, the long tail of Brexit still impacts business confidence – with fewer small businesses today looking to open up trading opportunities in EU markets.

“The looming Autumn Budget is also a concern for many, as there has been a lot of speculation about possible tax rises. At Novuna Business Finance we remain committed to helping established small businesses to secure funding to power future growth – but the message from Scottish small business owners seems to be very clear: they need a context of certainty to plan against and a tax framework that incentivises growth, expansion and investing in new staff.”

She concluded: “We need to see a reversal of the fall in small business growth forecasts we have seen over four consecutive quarters – and all eyes will be on the Autumn Budget for the stimulation package that many small business owners are crying out for. If we want to see growth in the economy, the forthcoming Budget needs to be a ‘Budget for business’.”