Poll: finance leaders resilient despite rising costs and economic uncertainty

Business leaders across the South West and South Coast are taking a cautious but resilient approach to the year ahead, according to new research from PKF Francis Clark.

More than eight in 10 businesses plan to maintain or increase investment, with technology and AI the top spending priorities.

The findings come from our recent finance director seminars held across Cornwall, Devon, Somerset, Dorset, Bristol and Hampshire, attended by more than 350 CFOs and finance directors.

Polling during the events revealed organisations are facing significant external pressures while continuing to invest in technology, efficiency and people.

Sentiment was finely balanced, with 34% of respondents feeling positive about the year ahead and 36% expecting conditions to weaken. Despite this, there is little sign of businesses retreating. Nearly half (46%) plan to increase investment over the next 12 months, while a further 36% intend to maintain current levels.

Respondents identified cost inflation as the biggest external challenge facing their businesses, followed by demand uncertainty.

However, many barriers to growth are internal. Capacity, workload and time pressures accounted for around 25-30% of internal challenges cited by those polled, while people issues, including recruitment, retention and skills shortages, represented a further 20-25%.

Against this backdrop, businesses are continuing to invest, with around 45-50% of investment focused on technology, AI and automation. Efficiency and cost reduction initiatives account for a further 20-25% of planned investment activity, followed by people, new products or services and infrastructure.

Nick Farrant, Bristol-based audit partner and head of food and drink sector at PKF Francis Clark, said: “Our findings paint a picture of a business community that is realistic about the challenges it faces but determined to move forward. This is in tune with conversations we’re having with our clients.

“Finance leaders are dealing with a difficult combination of rising costs, uncertain demand and stretched internal resources. Yet what stands out is the continued willingness to invest.

“Rather than pursuing growth at any cost, businesses are focusing on strengthening their organisations. Investment is being directed towards technology, automation, AI and efficiency improvements that can create capacity, improve productivity and build resilience. Businesses are adapting, making deliberate decisions and positioning themselves for long-term success despite continued uncertainty.”

Asked to describe their outlook for the year ahead, the most common words used by finance leaders included “challenging”, “uncertain”, “cautious” and “busy”. However, positive terms such as “optimistic”, “growth” and “opportunity” also appeared frequently, reflecting what Nick described as a mindset of “cautious resilience”.

Our research suggests that while economic conditions remain difficult, businesses across the South West are increasingly focused on building capability and improving efficiency, rather than simply cutting costs or delaying investment.