Barriers hold back £4.3bn in potential Scottish business growth

Barriers which are holding back £4.3 billion of potential Scottish business growth have been identified in a new report.

Barriers hold back £4.3 billion potential Scottish business growth. Picture: PA Wire

The study identifies an array of barriers to growth including technology, access to skills, talent and innovation, and financial issues.

The Grant Thornton UK LLP research - based on a survey of 114 Scottish businesses with turnover between £10 million to £1 billion - says that if the barriers are surmounted this could unlock an estimated £4,336,253,750 in gross value add across the economy.

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Researchers found that while UK business optimism has been on a downward trend since the months leading up to and following Britain’s referendum on EU membership, the study suggests Scottish businesses remain focused on future growth.

More than two-thirds (70 per cent) of respondents plan to maintain current levels of growth in the future, above the UK average of 61 per cent.

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Andrew Howie, Grant Thornton UK’s managing partner in Scotland, said: “Scotland’s business community has clearly been unsettled by the outcome of the Brexit vote and the limited information on future trading relations with the EU and other global economies.

“While confidence may have taken a knock, our research suggests access to skills and investment in technology remain at the forefront of their concerns.

“It’s encouraging that 70 per cent of Scottish business leaders plan to maintain current levels of growth in the next two years, which reinforces the sense of resilience driving the success of Scotland’s vibrant economy.

“Many obstacles are on the horizon. But by working more collaboratively, strategically and with purpose, our rich and varied business community can contribute even greater growth - and shape a successful, sustainable future for the country.”

The survey found that investment in technology is the biggest area of concern with 38 per cent of respondents describing technological investment as a potential barrier to future growth.

In second place was access to skills and talent with 37 per cent of respondents saying it could hamper their long-term expansion plans.

Just over a third (35 per cent) were concerned about brand, marketing and sales capability while 32 per cent said that financial issues such as cash flow, liquidity and access to capital were a barrier to growth.

Issues relating to systems, processes and operating models were also among the top five barriers to growth.

The study found that half of businesses in Scotland are looking to invest in technology in future while 39 per cent plan to increase international collaboration and networks.

Only 22 per cent of respondents said they plan to invest in a dedicated Brexit strategy, compared to 24 per cent across the UK as a whole.