Most of the North West’s mid-sized firms are beating their growth targets for the year, new research from BDO has shown – but many are also losing confidence in the Ƶ as a place to do business.
The latest Economic Engine research from the accounting and business advisory firm shows 71% of the 500 firms polled have reported stronger-than-expected performance this year, with 23% saying they have “significantly exceeded expectations”. Firms said key drivers for growth included new products and services (52%) and “better-than-expected staff recruitment and retention” (36%).
Businesses have also remained committed to capital investment, with 66% keeping investment steady and 29% increasing investment, with just 6% planning to scale back.
However, firms are getting less confident about the wider Ƶ market, with 66% saying conditions have become more challenging and just 34% saying the Ƶ is a “strong environment” for long-term business growth. Some 23% of those polled were already shifting operations or investment overseas.
The study showed some 51% of mid-sized firms were looking to invest in automation, technology or AI, with 46% looking to secure new investment or finance. But half of those polled said skills gaps remained a challenge, while 34% said supply chain disruption was a barrier to growth.
Angela Cross, regional managing partner at BDO in the North West, said: “These findings highlight the strength of the North West’s mid-market – businesses are delivering growth and continuing to invest despite challenging conditions. But they also carry a warning; confidence in the Ƶ as a place to scale is not guaranteed.
“With mid-sized businesses continuing to contribute significantly to the regional economy, creating a wealth of additional jobs to boost the future outlook in the North West, the government will want to use the Autumn Budget to reassure this segment of the market and address persistent barriers around skills, costs and competitiveness. Only with the mid-market firmly and confidently anchored in the North West, will we see the growth the regional economy needs.”
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