Competition is the single biggest challenge currently facing UK businesses overall against the backdrop of ongoing Brexit negotiations, according to new research.
Polling undertaken as part of the Lloyds Bank’s Business Barometer report revealed that, against a backdrop of ongoing Brexit negotiations, firms see competition as the greatest risk.
In general, these risks are facing their business (24%), followed by demand outlook (20%), regulation (18%) and the labour market (14%).
The threat posed by competition is viewed as particularly acute by the retail and wholesale sectors, where 42% and 39% of businesses respectively saw it as their biggest challenge.
Meanwhile, the labour market was seen as the biggest challenge for both the hospitality and manufacturing sectors (27% and 21% respectively).
Challenges posed by Brexit
When asked to cite the specific challenges posed by withdrawal from the EU, businesses said weaker demand was their biggest concern (16%), followed by the cost and availability of labour and foreign exchange volatility (both 15%).
Despite their concerns about the risks posed by Brexit, a net balance of just 25% of businesses are planning to take active steps early on to avert the risk posed by a ‘no deal’ scenario.
Almost four in ten (38%) businesses have no contingency plans in place to counter the possibility of Brexit negotiations falling through, compared with 20 per cent that have taken some steps already and 25% that plan to do so in the next 12 months.
The construction sector is reportedly the least prepared for Brexit, with almost half (45%) admitting no strategies are in place. The research showed that some 18% have already made Brexit preparations, with a further 20% planning to take action to avert potential risks over the next year.
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