Most small and medium-sized Yorkshire businesses expect to achieve profit and sales growth as well as creating more jobs in the next financial year.

Professional services firm Deloitte reports that more than half (53 per cent) of the companies questioned in its latest survey said that improving profitability was their primary focus.

Nearly 70 per cent believed that this was achievable within the next year and a quarter of those expected the rise would exceed 20 per cent.

Nearly 60 per cent of the firms in the region - compared with 38 per cent nationally - anticipated growing their workforce in order to increase profits.

Jonnie Oldham, a partner in Deloitte's Yorkshire office, said: "Small and medium-sized companies are predicting increased profitability, which suggests that they are confident that the economy is becoming more favourable. To achieve this, companies are looking at their existing resources and seeking to manage them more effectively."

Three-quarters of survey respondents in Yorkshire and the north-east (77 per cent) are predicting sales growth, with a quarter of them expecting the growth to be more than 20 per cent. Most companies see an expanding market share as the most important factor in achieving growth. The construction and real estate sectors are the most confident, with 90 per cent expecting sales growth this year.

The middle market sector is already fiercely competitive, and this is set to continue as companies seek to increase their market share, said Mr Oldham.

Successful companies would continue to focus on low prices and innovative marketing and sales techniques.

Updated: 10:51 Monday, March 29, 2004