With an increase of 1%, SME turnover slows in August

The Omie Index of Economic Performance of SMEs (IODE-SMEs) shows a high of 1% in the financial movement of small and medium-sized enterprises (SMEs) in August 2024, compared to the same month of the previous year.In the accumulated of the year, the sector has an expansion of 4.9% compared to the same period of 2023.

Figure 1: IODE-SMEs
(Index number 2021=100)

Source: IODE-PMEs (Omie)

The IODE-PMEs works as an economic thermometer of companies with revenues of up to R$50 million annually, divided into 701 economic activities that make up four major sectors: Commerce, Industry, Infrastructure and Services.

Felipe Beraldi, economist and manager of Indicators and Economic Studies at Omie, management platform (ERP) in the cloud, explains that the development of SMEs in August 2024 was heterogeneous, especially Trade, which led the expansion (+8.4%), after having already advanced 19% in the previous month.“There are positive signs in the economy of the country, such as the strength of the labor market and the increase in the real average income of families, which have maintained consumption at high levels, boosting the performance of SMEs in this sector”, he comments.

In addition, the figure is explained by the weak comparison base of the second half of 2023 (-11,2%). The evolution has been observed both in wholesale (+22%) and retail (+7%), which reinforces the positive turn of the sector in recent months and increases expectations for Black Friday, an important seasonal date for sales in the second half.

Industrial SMEs, on the other hand, fell by 3% in August. “It is important to note that the movement can be an isolated point, since the comparison base of the sector is considerably high. In the same period last year, the growth was 25.6%”, Beraldi ponders. Anyway, in August, there was a positive performance of the activities of Impression and reproduction of recordings, (Fabrication of furniture and Fabrication of machines and electrical appliances’ (which restricted more abrupt falls in the segment.

In the Services sector, SMEs also registered a slight decrease, - 1.3% compared to the same period of the previous year, after a robust performance in July (+6.2%). During this period, the performance of the sector was uneven between the different categories, with evolution mainly in the Administrative Activities and the Delivery Activities’.

Finally, SMEs in the Infrastructure sector maintained stable real financial transactions (+8.6%), after having advanced in the previous month with emphasis on the segment of (Collection, treatment and disposal of waste’.

Despite the most restrained result in the month, according to the economist, it is still early to point out a possible turn of trend of the economic activity of Brazilian SMEs.“It is a fact that the market expects some slowdown of the economy in the second half of the year.But, the strong performance of the domestic economy recorded in the second quarter (growth of 3.3% in the annual comparison) and the maintenance of the heated labor market are important signs that SMEs can maintain a robust rise in the short term”, he predicts.