UK mid-sized businesses plan multi-million pound investment, BDO finds

The UK’s mid-sized businesses are gearing up for growth, with more than half (51%) planning to invest upwards of £3m in the next five years in order to scale-up their business, according to BDO. 

BDO’s bi-monthly survey of 500 mid-sized businesses, which generate a turnover of between £10m-£300m each and account for one in four UK jobs, has revealed that almost two fifths plan to direct the majority of their investment within the UK. 

Almost a quarter of businesses (24%) said that sourcing new capital to invest was one of their top priorities between now and the end of the year. This includes private equity investment, venture capital or additional bank loans.  

With a new government now in post, mid-sized businesses are calling for policies that will help them deliver these plans to scale-up. More than two fifths (45%) want to see a new government prioritise smaller business banks entering the market or grants for their business. 

Meanwhile, a third (33%) are calling for simpler regulation around listing mid-sized businesses on the London Stock Exchange’s Main Market or Alternative Investment Market (AIM), as over a quarter (27%) are considering an IPO outside of the UK.  

Almost two fifths (39%) want to see more investment in the regions outside of London and the South East, something the Labour party committed to in its manifesto as part of its “Plan to Power Up Britain”.  

Other obstacles to growth include persistent recruitment challenges, with almost half (47%) wanting to see policies to ease workforce pressures, including reform of the apprenticeship levy or more support towards the cost of skilled worker visas.

Despite these ongoing challenging economic conditions, a quarter of businesses consider themselves to be optimistic for the future, seeing potential recovery on the horizon. This compares to less than a fifth (18%) who say they are pessimistic for the future. 

Richard Austin, partner at BDO said: “With a new government in place and inflation hitting the Bank of England’s 2% target in May, it looks like businesses may have some reason to be optimistic after years of challenging economic conditions and uncertainty.

“Mid-sized businesses are the engine of the UK’s economy and their desire to invest is good news for the new Government. Policymakers need to follow their lead and create an environment where they can flourish and achieve their ambitions for growth.”