[Saitama Prefecture] Results of the Saitama Prefecture Quarterly Business Trend Survey (January–March 2026) and Launch of the 'Saitama Prefecture Quarterly Business Trend Survey Data Site'

1. Saitama Prefecture Quarterly Business Trend Survey (January–March 2026)

Saitama Prefecture conducts quarterly business trend surveys targeting 2,200 small and medium-sized enterprises (SMEs) in the prefecture. The results for the January–March 2026 period (survey date: March 1, 2026) have now been compiled.

In addition to the regular survey on business sentiment, this quarter also covered 'price pass-through' and 'progress on DX (digital transformation) initiatives.'

<Key Points from the Regular Survey>

Business Sentiment of SMEs in Saitama Prefecture: 'Business sentiment among SMEs in Saitama Prefecture shows signs of recovery.' 'The outlook shows signs of improvement.'

- The overall business sentiment DI* stood at -37.6, a decrease of 0.4 points from the previous quarter, marking a deterioration for the first time in three quarters. - In manufacturing, the DI was -39.5, down 1.7 points from the previous quarter — also the first deterioration in three quarters. - In non-manufacturing, the DI was -36.2, up 0.6 points from the previous quarter, marking three consecutive quarters of improvement. - The sales DI and cash flow DI for all industries deteriorated for the first time in two quarters, while the profitability DI deteriorated for the first time in four quarters. The capital investment implementation rate also declined for the first time in four quarters. - The forward-looking business sentiment DI for the next quarter (April–June 2026) was -12.7, up 6.0 points from the previous quarter, improving for the first time in two quarters.

* An index calculated by subtracting the percentage of companies responding 'in recession' from the percentage responding 'in prosperity' regarding business conditions in their respective industries.

<Key Points from the Special Survey>

- Regarding price pass-through, 57.5% of companies responded that they are 'sufficiently able to negotiate (discuss) prices with ordering companies,' an increase of 2.9 percentage points from the previous survey. - Meanwhile, 26.9% responded that they are 'not sufficiently able to do so,' a decrease of 1.8 percentage points from the previous survey. - The most commonly cited challenge in pursuing DX was 'lack of personnel to lead DX' (40.0%), followed by 'insufficient funds' (37.8%) and 'not knowing what to do or how to proceed' (24.7%). - Regarding support expected from the prefecture in pursuing DX, 'financing and subsidies' ranked highest (40.2%), followed by 'human resource development and supply' (18.5%) and 'enhanced consultation services' (17.5%).

<Survey Overview>

Survey method: Written questionnaire survey; interviews with industry associations and individual companies Survey target period: January–March 2026 (survey date: March 1, 2026)