Plimsoll's Latest Survey Results

Plimsoll's latest quarterly survey of the mood across the UK economy comes at a time of spring optimism and the hope that the dark days of the past 12-18 months are behind us.

There is a palpable sense that with lockdown restrictions being eased, vaccines working and the country slowly emerging out the shadows of COVID-19, we are set for a period of strong economic growth. If our latest survey is indicative, business leaders appear to have been caught up in the improvement in sentiment.

Plimsoll analyses more than 1600 markets in the UK economy and counts thousands of the UK’s leading businesses among our valued clients. As part of our role as a provider of in-depth analysis and intelligence, we “take the pulse” of the UK economy’s most important people – those running our businesses.

We have asked thousands of the UK’s directors and senior decisions makers the following:

In the last 6 months, have sales exceeded expectation?

76% of respondents to Plimsoll’s survey said they have seen sales above what they expected. It’s refreshing to see ¾ of companies in the UK seeing revenue returning and by June the last remaining locked down market such as hospitality and travel should also start to see a major influx of new business.

Having analysed every major sector of the UK economy, Plimsoll has been able to see the winners and losers of the past 12 months. Certainly, the Tech / IT sector appears to have benefitted from the migration to home and remote working. The UK’s top 500 Software companies are among the fastest growing in the entire country according to our latest analysis.

Of course, industries where physical interaction remains entirely necessary have been hammered in the last year with Hairdressers the worst affected. Hopefully, the tide is turning for those that have suffered the most.

Are you making a profit month on month?

88% of companies surveyed said they have returned to profit as business evolves, adapts to the new normal and benefits from the gradual easing of the strictest lockdowns. A year ago, many companies hunkered down and searched for a means to survive, so it is heartening to see almost all respondents told us that they are returning to profit.

Based on Plimsoll’s comprehensive analysis, the Legal and Green Energy sectors are leading the country’s journey back to profitable business. Both Off-shore and On-shore Wind Farm Operators are among those industries that have seen the biggest increase in profitability.

The hospitality sector is struggling for profit as they continue in their current state of lockdown. However, there are other industries that are showing a surprising lack of profitability. New industries such as EV Charging  and CBD Products are currently struggling with extremely low profit returns and a high number of loss-making companies. As they mature, these relatively young markets might be due a round of consolidation.

Do you sense that staff morale is improving?

84% of companies answered that they feel the morale of their staff is on the up. The British workforce has shown a remarkable resilience throughout the pandemic and it is welcome news that the sense of optimism appears to be trickling down.

Though furlough schemes have helped soften the blow COVID-19 dealt to businesses in shuttered industries, the threat of redundancy and lost income has been a constant fear. Hopefully, brighter days are just ahead.

Plimsoll’s analysis has  highlighted a few industries that are getting the most from their staff and their continued engagement. The Energy sector, particularly Wind energy generates an enormous sales return from their staff of more than £1m per employee.

Inversely, those sectors of the economy that we have relied on during the pandemic are those that are least able to generate sales per employee due to their labour intensive and sometimes sensitive nature. Sectors so as Cleaning, Care homes, Domiciliary care and Child provisions are all at the bottom of the list.

Do you expect more acquisition deals in your market?

75% of companies expect consolidation in their market. All the ingredients are in place for a major increase in the number of deals being done in the post pandemic economy.

Weakened companies could be looking to bring in investment to shore up their finances. Companies that had their dependencies exposed in the crisis could look to diversify through acquisitions. Many markets can no longer support so many companies.

Plimsoll help companies find the best possible acquisition prospects that match their needs. For those looking for distressed M&A opportunities, there are obvious sectors such as Care, Leisure, and Hospitality sector where finances have been stretched by the pandemic. More surprisingly, we also see several opportunities in laboratory-based industries. The UK Clinical research and the Food testing markets both have a high percentage of acquisition opportunities.

Is your business in a stronger position than 12 months ago?

83% of respondents feel that their business is in a stronger position than at the start of the pandemic. This time last year the country locked down completely and we weren’t allowed to leave home for anything other than 60 minutes exercise. With government support and an adaptive attitude, many UK companies have survived when there were initial concerns they wouldn’t. Thankfully, the optimism is returning.

However, how much of that optimism is based on reality and how much is exuberance that something more normal is on the horizon? There are some UK industries that are extremely robust whereas others have long standing issues that leave many of the companies within them vulnerable.

Plimsoll has developed an intuitive model proven as a measure of overall financial performance of any business. Based on our assessments on companies across the economy, many industries feeding into the construction sector remain extraordinarily strong. Concrete, Roofing and Brickwork companies all have a very high percentage of companies rated as “Strong” by Plimsoll.

While the Wind energy industry continues to power ahead, both Solar and EV Charging markets have very few companies that have been rated as “Strong” by Plimsoll. Could these be mere teething issues for these emerging, green energy markets or signs of consolidation needed in the future.

Whichever market you operate and however well you have fared over the past 12 months, it is welcome news to see so much positivity in the UK economy. The important thing now is to calibrate your business to capitalise on the reopening of markets and protect your own position.

Plimsoll provides the in-depth intelligence every business needs to make better decisions. Whether you are looking to identify your own weaknesses or look for frailties in your competitors, we can provide the analysis you need. If you are looking to acquire another business, we can help you narrow down millions of companies to the 10-20 that meet your needs. Whatever your business needs, Plimsoll can provide instant analysis to help you make better decisions faster.

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