More small and medium-sized enterprises (SMEs) have seen a quarterly reduction in sales volumes than large companies, research finds.

According to insolvency trade body R3, 29 per cent of smaller businesses saw shrinking revenues in Q4 compared to Q3, with just 6 per cent of large businesses reporting the same.

The research also finds that more than one third (34 per cent) of SMEs are experiencing decreased profits on the quarter compared to 19 per cent of big businesses.

R3 president Frances Coulson says, ‘The government has created a number of schemes to support SMEs as they are vital to the health of the economy, but they need more help to survive this difficult economic environment.

‘It is clear that many SMEs are not financially robust enough to withstand the economic pressure. Either more support is needed in 2012 to enable a real recovery, or some businesses will inevitably fail rather than continue to limp along, damaging competition.’

Across the board, fewer businesses (58 per cent) report seeing ‘signs of distress’ than the last quarter (68 per cent) and significantly less than December 2010 (77 per cent).

The report also finds that businesses able to make and receive online payments are faring better than those that can’t. Some 39 per cent of those that can’t use online payments are experiencing decreased profits, compared to 25 per cent of those that can.

Furthermore, 34 per cent of those who can’t use online payments have seen a reduction in sales volumes, compared to only 19 per cent who can.

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