UK’s mid-sized firms face rising supply chain & energy costs

Supply chain disruption and rising costs remain the biggest threats facing UK mid-sized businesses, according to new research from accountancy and business advisory firm BDO. Almost half (46 per cent) of firms expect supply chain pressures, alongside rising fuel and energy costs, to be their biggest challenge over the next six months.

Manufacturing, construction, and hospitality and leisure businesses are facing the greatest pressure due to complex supply chains and high operating costs.

Around two fifths (40 per cent) of businesses say current pressures are forcing them to scale back or pause investment plans, down from 60 per cent earlier this year. Meanwhile, 35 per cent expect to pass additional costs on to customers, BDO said in a media release.

Businesses are also taking measures to reduce costs and improve resilience. Some 35 per cent plan to reduce energy consumption, while 41 per cent intend to accelerate investment in low-carbon technologies.

Around 30 per cent of businesses are prioritising UK-based suppliers, with a similar proportion using onshoring and nearshoring to reduce their exposure to supply chain disruption.

One in five (21 per cent) mid-sized businesses want the government to prioritise targeted support to tackle supply chain disruption. The firm has called for improved energy cost relief, better access to the electricity grid for manufacturers and greater support for investment in new technologies.

The findings from BDO’s Mid-Market Tracker are based on a survey of 500 businesses with revenues between £10 million (~ $13.6 million) and £500m (~$680 million).

Fibre2Fashion News Desk