French SMEs and Local Businesses Struggle Amid Economic Challenges and Mobilization

On October 13, Medef, France's leading employer organization, organized a significant demonstration in Paris to spotlight the mounting economic difficulties faced by French companies, especially small and medium-sized enterprises (SMEs) and local businesses. Fabrice Le Saché, Medef's national vice-president, stressed the importance of promoting intermediate-sized enterprises (ETIs), which play a crucial role in investing in technology and building future economic wealth. However, he warned of a growing economic stagnation in France, with the country lagging behind neighbors in growth.

Local issues were highlighted by Jean-Luc Guéry, president of GPI-Medef 47 from Lot-et-Garonne. He addressed specific burdens faced by businesses, including waste-related taxes and transport contributions that ultimately impact consumers. Guéry also drew attention to increasing competition from Chinese firms like Temu and Shein, which operate under different regulations than European companies. This competitive pressure has contributed to a surge in business failures in Lot-et-Garonne, reaching levels not seen since 2015, with the construction sector particularly affected.

Individual enterprises like Jean-Michel Carpentey's shoe repair shop in Lesparre-Médoc illustrate these challenges on the ground. Carpentey, who has been shoemaking for nearly 19 years, has seen his business decline sharply, currently undertaking only about 20 shoe repairs weekly compared to 50 daily previously. This downturn is partly due to the pedestrianization of his street, which has reduced customer foot traffic, and rising raw material costs such as a 30% increase in rubber prices over two years. His business entered judicial recovery in November 2024, a reflection of the difficulties faced by many local companies.

The Medef demonstration in Paris gathered representatives from various regions who seek greater support and recognition for the crucial role that SMEs and local businesses play in France's economy. The economic pressures of taxation, regulation, and global competition remain critical issues prompting calls for policy attention and action.