The pandemic period has been the most disruptive in recent economic history, arguably since the Second World War. At every juncture of the last two years businesses of all shapes and sizes, offering a whole spectrum of products and services, have had to adapt and learn to live with economic conditions nobody ever considered as recently as 2019.
Whatever your market, strategic plans have been torn to shreds. Investments have been left to wither as markets were shut down. Many financial commitments have been met on the back of government support as revenue fell to zero. A return to the relative stability of pre-coronavirus certainty allowing for calmer business decision making can often seem so far away.
Plimsoll is the leading provider of business insight. We have, for more than three decades, highlighted the companies in thousands of industries that were in danger of failure. We have alerted the world to the markets where crises, and opportunities, are brewing. The pandemic has made this job much harder, but also much more important.
As a key provider of financial intelligence, we can tell you which companies in any market are primed to succeed or most likely to fail whatever the markets they serve. However, we have also taken a close look at how different company structures have fared over the past couple of years.
There are three predominant ownership structures that UK companies adopt; foreign-owned, independent companies, and quoted companies. But how has each type managed the pandemic? Plimsoll has examined the 250 largest UK companies in each category and compared their performance against the main KPI’s:
| Company Type |
Growth |
Profit |
Staff numbers |
% in Danger |
|
| Quoted |
-5% |
4% |
-2% |
54% |
|
| Independent |
-1% |
2% |
-1% |
42% |
|
| Foreign-owned |
-4% |
2% |
0% |
41% |
Independent companies
Large UK businesses that retain an independent ownership structure have, on the whole, seen sales fall by the least amount during the pandemic. For many, a nimble ownership structure has seen them better able to make decisions to maintain market share. While profits have fallen to 2% in the latest year only a quarter of companies posted a loss – the lowest percentage.
As an overall measure of performance, 42% of independent companies analysed were rated as Danger by Plimsoll.
Foreign-owned companies
UK companies with an overseas parent have seen an average 4% fall in sales as the pandemic swept the country. They also saw their profit margins decline to 2%, much like independent companies. However, perhaps most interesting, companies with a foreign ownership structure retained the most staff and, conversely, remained the most productive, generating £535,000 sales per employee.
As a top-level performance measure, 41% of foreign-owned companies were rated as Danger – the lowest number.
Quoted companies
Publicly quoted businesses have, arguably, fared the worst during the pandemic. While they have retained the highest profit margins, perhaps with shareholder returns in mind, growth has been compromised the most, having fallen almost 5%. In fact, 1 in 3 of the 250 PLC’s assessed have seen sales fall.
As a result of falling sales, productivity is under pressure with sales per employee falling to £219,000. Consequently, more than half of the quoted companies analysed by Plimsoll were awarded a Danger rating.
While the differences in performance between ownership structures are quite nuanced, there are clear disparities between the three. Quoted companies appear to have protected their profit margins while independents have been best able to protect their market share. Perhaps the most surprising finding is that foreign owners have retained the most UK jobs.
Whatever your industry, there will be a mixture of these ownership structures each bringing different corporate goals that will impact the rest of the market. Understanding the performance and outlook of every company in your own market will be the key to a successful 2022.
Plimsoll provides individual analysis and future outlook of every company in more than 1600 UK markets. For more information on what Plimsoll has revealed in your key industries, visit www.plimsoll.co.uk