As a business owner who serves small businesses, Alastair Williams is well positioned to gauge recovery in that sector of Bermuda’s economy.

“Are we beginning to see these ‘green shoots’ appearing?” Mr Williams asked The Royal Gazette as part of our continuing articles exploring the state of small businesses.

“I sometimes think they’re out of their minds, but I am seeing people starting new businesses.”

As the managing director of Business Automation Resources, Mr Williams is in regular touch with local businesses: he is the local NCR (National Cash Register) distributor, specialising in point-of-sale support systems.

Now selling iPod-based systems using cloud technology, Mr Williams has an inexpensive and mobile product that caters to the needs of small operations.

“In the last two years we’ve sold about 65 of them to various people,” he said, and so far only two seem to have failed as businesses.

Nonetheless, small enterprises have been particularly struggling and retail is taking the brunt of it.

“No doubt about it,” Mr Williams said. “The consumer has cut back so retail has to cut back.”

Restaurants are one of his main clients, and he has heard tales of their business declining “anywhere from 20 per cent to 60 per cent over the last six years”.

A familiar complaint has been that Bermuda’s banks are being unfairly conservative in their lending policies.

“I have to be careful how I say this, because I sell ATMs to banks,” Mr Williams said.

“Banks here have themselves in a pickle. They have a huge mortgage overhead and a lot of people that are either unable to pay, or on some sort of mortgage relief plan.”

The Bermuda Government “needs a wider programme to guarantee loans to small businesses”, he said.

“If we really want to kick-start this economy again, it’s going to have to be more. The banks are being conservative because they have to.

“We’ve got the Bermuda Monetary Authority trying to get Solvency II accredited for the country, which has all sorts of implications. It forces banks to be more cautious about what they do.”

The Island’s economy is struggling against a chain reaction, he said: cash-strapped small companies are slow to pay so they lean on their suppliers; suppliers run out of cash and can’t get working capital loans from banks.

“I’m not known as an optimist, but if you’re an entrepreneur you have no choice but to be upbeat about it,” he said.

“The fact is, even with this economy, I have seen some small businesses do extremely well. They’ve taken the chance and they are growing.”

Mr Williams described himself as underwhelmed by the Economic Empowerment Zone initiative.

“A number of businesses have taken advantage of this, but for all the breaks they get it’s just a waste of time if the business doesn’t work,” he said. “You have to have that traffic. It’s a risk.

“You have to be extremely cautious about what businesses you get into.

“It’s not like 2005 where any business you start is going to bloom.”

One looming issue, he said, was the advent of chip-and-pin technology, which could force already stressed enterprises to shell out more money that they can ill afford.

“The credit card system is going to change in the next six months. Bermuda is going to get chip-and-pin.

“The credit card companies have mandated that in October 2015, the liability for credit card fraud will shift from them to the merchants.

“It’s going to be expensive — businesses are going to have to replace their machines, and they will have to make the decision whether it’s worth it to them.

“With restaurants, you’re looking at five to ten of these devices. It could be $700 a shot. You’re looking at a considerable investment.”

Keetha Lowe, formerly the owner of a small business who is collaborating with The Royal Gazette on this series, said that simpler mobile technology such as that of Mr Williams could provide a break for struggling entrepreneurs.

“Thorough financial records are critical not only for tracking profits and losses,” she said.

“Such records are essential for progressing any form of credit lines and borrowing capacities.

“For business owners who elected to sell their operations, financial records are imperative to successful negotiations.

“At a time when staffing demands are difficult to maintain for small business owners, automated support systems offer a viable alternative, to some extent.”