North West Firms Surpass Growth Targets but Face UK Challenges

Recent research from the accounting and business advisory firm BDO reveals that a significant majority of mid-sized firms in the North West of England are exceeding their growth targets for the year. However, alongside this success, many are expressing concerns about the future business landscape in the UK.

The latest findings from BDO’s Economic Engine survey indicate that 71% of the 500 firms surveyed reported stronger-than-anticipated performance in 2025, with 23% stating they have “significantly exceeded expectations.” Key factors driving this growth include the introduction of new products and services, cited by 52% of respondents, and improved staff recruitment and retention strategies, highlighted by 36%.

Despite these positive indicators, confidence in the UK market appears to be waning. A notable 66% of firms indicated that they are facing more challenging conditions, while only 34% described the UK as a “strong environment” for long-term business growth. This uncertainty has prompted some companies to consider shifting operations or investment overseas, with 23% already making such moves.

Investment trends reflect a commitment to future growth, with 66% of businesses maintaining their capital investment levels and 29% increasing their investments. Only 6% plan to reduce their investment efforts. Additionally, the study found that 51% of mid-sized firms are looking to invest in automation, technology, or artificial intelligence, while 46% are seeking new investment or financing opportunities.

Nonetheless, challenges remain. Half of the firms surveyed acknowledged persistent skills gaps as a significant barrier, and 34% cited supply chain disruptions as hindrances to their growth.

Angela Cross, regional managing partner at BDO, remarked on the dual nature of the findings. “These results showcase the strength of the North West’s mid-market,” she said. “Businesses are achieving growth and continuing to invest despite challenging conditions. Yet, they also signal a warning; confidence in the UK as a place to scale is not guaranteed.”

Cross highlighted the importance of mid-sized businesses to the regional economy, emphasizing their role in creating jobs and enhancing the future outlook for the North West. She urged the government to utilize the upcoming Autumn Budget to reassure this segment of the market and to address ongoing issues related to 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,” she added.

As the landscape continues to evolve, the resilience of North West businesses remains critical for regional economic prosperity.