Scottish firms 'entering new year with ambitious growth plans', according to Bank of Scotland data

Private sector north of Border eyes brighter and more productive 2024.

A third of Scottish businesses are making New Year’s resolutions to crank up their productivity, with the private sector forecasting more positive macroeconomic conditions, according to newly published research from Bank of Scotland. The lender, part of Lloyds Banking Group that in October revealed third-quarter profits of £1.9 billion, said such optimism comes after a “tough” 2023 for businesses, as they worked battled high inflation and a sluggish economy.

The report also shone a spotlight on top areas of focus for firms as they head into the new year, with a third citing investing in staff training, and about three in ten planning to increase staff wages. Additionally, just under a third of firms polled flagged plans to keep a closer eye on costs over the next 12 months.

The lender added that the data shows businesses are setting themselves up for growth, with almost half expecting to hire more staff in the new year, and nearly seven in ten firms are confident that they will become more profitable in 2024 compared to this year, with the expectation of inflation continuing to fall, having dropped to 3.9 per cent in November. Bank of Scotland said two in five expect their turnover to increase in 2024, and of those, 21 per cent anticipate growth of between 5 and 10 per cent, and a further 23 per cent have eyes on growth of up to 5 per cent.

The lender, headquartered on the Mound in Edinburgh (file image), says the current optimism comes after a 'tough' 2023 for businesses. Picture: Lisa Ferguson.

Martyn Kendrick, regional director for Scotland at Bank of Scotland Commercial Banking, which recently said business confidence north of the Border fell ten points during December to a net reading of plus 31 per cent, said: “Scottish firms are entering the new year with ambitious growth plans… It’s been a challenging year, but the recent easing in inflation and stabilisation of interest rates are helping to create an environment where businesses can look ahead more confidently, and put measures in place to boost future growth.

“By taking the time to reassess priorities and manage cashflow carefully, businesses will be ready to benefit from new opportunities and to tackle headwinds more effectively. Hopefully the new year will see demand for our world-class industries and services continue to improve, and help further support growth for Scottish businesses during 2024.”