Third of businesses anticipate financial support requirements in 2025

One in three of these businesses anticipate needing financial support as they head into the new year according to the latest research from accounting and advisory firm, BDO.

BDO’s bi-monthly survey of 500 mid-sized business leaders, which looks at the challenges and opportunities facing UK companies with a turnover between £10m-£300m, reveals over a quarter (29%) are grappling with significant supply chain challenges, with delayed deliveries and inventory shortages disrupting operations and impacting their ability to meet customer demands.

These challenges are being exacerbated by ongoing economic and geopolitical tensions, and the prospect of new tariffs on international trade from the incoming US presidential administration this month.

At the same time, rising operating costs continue to be a major challenge. Three in ten (28%) companies now see the growing financial burden as their top concern going into the new year, with 32% of mid-sized businesses anticipating the need for additional financial support – including bank loans or government grants – to help navigate the hurdles of 2025.

Despite these challenges, many mid-sized businesses are entering 2025 with more confidence than at the start of the decade. Nearly half (49%) feel they are in a stronger position than before the COVID-19 pandemic nearly five years ago. This is reflected in their investment intentions, with an average of £4.6 million earmarked by mid-sized companies over the next two-five years.

As part of their investment plans, almost half (47%) of mid-sized companies are looking to integrate AI into their supply chain operations to streamline processes, reduce errors and improve overall efficiency. Furthermore, nearly a quarter (23%) are planning to invest in specific roles to support AI adoption.

Richard Austin, Partner at BDO, said “Mid-sized businesses have faced a tough decade so far but, despite ongoing supply chain challenges and elevated costs, they are entering 2025 in a stronger position and with strong intent to invest in future growth.

“We need the Government to throw its weight behind these ambitious, resilient mid-sized businesses. They are the engine room of the economy, employing more than eight million people across the UK. They need a more favourable operating environment, underpinned by policy and taxation, that enables better access to capital and encourages ongoing investment in new technologies.”