An overwhelming majority of UK firms say they believe trading conditions during the 2017/18 financial year will be tougher this year compared to 2016, data for this year’s UK 200 has revealed.
Responses gathered from the UK’s 200 biggest firms by turnover cite Brexit as the biggest fear for the current financial year.
Asked to state the extent to which they agreed that trading conditions would be tougher this year than last, 17 per cent of firms said they agreed completely with the statement while 58 per cent said they agreed to an extent, a total of 75 per cent.
Another 20 per cent of firms said they neither agreed nor disagreed with just 5 per cent either disagreeing to an extent or completely that trading conditions will be tougher.
This is the second time that The Lawyer UK 200 report has included a question related to trading conditions. The results will be featured in full in this year’s report.
In last year’s report only 70 per cent of firms agreed with the statement, indicating that the market outlook at the majority of firms is bleaker than 12 months ago.
Notably, smaller firms are significantly more pessimistic that larger ones. Half of surveyed firms with revenues of more than £200m expect trading conditions in 2017/18 to be tougher than in 2016/17. This proportion rises to 62 per cent for firms generating between £22m-£50m and to 86 per cent for firms generating less than £22m.
When asked why they expect trading conditions to be tougher this year, most firms cited Brexit, political and economic uncertainty and increased competition, with Brexit the most frequently mentioned reason.
Indeed, the percentage of firms that highlighted Brexit as a major risk to their financial health rose from 41 per cent last year to 65 per cent this year.
Cyber risks remain the second most important concern, with 49 per cent of firms highlighted cyber threats as a major risk compared with 36 per cent last year.
“With the increasing level of cyber-attacks, this is clearly an area of significant risk for all businesses over the next 12 months,” said one firm. “We are putting significant resource and financial investment into managing this risk. “IT Infrastructure is another area which requires ongoing investment to minimise risk as elements of our IT estate, including our practice management system become due for renewal or replacement.”
“The threat of attack is getting stronger,” added another.
This is an extract from the upcoming edition of The Lawyer UK 200: Top 100 report, which will be published on Monday. For more information about the content of the reports please contact Matt Byrne on 0207 970 4558 or firstname.lastname@example.org. To purchase any of the UK 200 series please contact either Gilberto Esgaio on +44 207 970 4191 or Gilberto.Esgaio@centaurmedia.com or Letitia Austin on +44 207 970 4662 or email@example.com.