Happy New Year & Welcome to 2025: A Year of Opportunity for Scottish Businesses

As we turn the page on a new year, it's a time to reflect on the past and look forward to the future, and although we are a little over a week into 2025, there is a definite undercurrent of optimism around the Scottish business world. Bank of Scotland’s Business Barometer reports that nearly three-quarters of Scottish businesses forecast turnover growth, a yearly improvement of over 20%. Those predicting improved profitability through 2025 are almost as high at 70%.

So, what is driving this confidence?

Firstly, and possibly on shaky ground, is the view that inflation and rising costs are beginning to ease. This would be welcome news for all of us; however, I’m wary of how quickly and for how long we will see these pressures ease. The U.S. Fed has slowed its interest rate cuts, and the predicted Bank of England rate is higher than previously predicted at the tail end of 2024. Just yesterday, we read that UK government borrowing costs have risen to a recent high, and the knock-on effect will be increased borrowing costs for business and, ultimately, higher costs across the board.

Our access to finance drives continuing optimism; whilst many businesses are looking to self-fund their growth, those looking for outside investment are finding it easier to access additional funds than businesses in the rest of the U.K. The Scottish Government and Local Authorities can take some of the credit here through fantastic initiatives such as Scottish Enterprise, Business Gateway, and the Loan or Growth schemes. Scotland‘s historic ties to the financial sector undoubtedly benefit us all.

Further optimism for Scottish Business is warranted by Scotland’s unique place in the world and history. Two of the five key global trends we are seeing—technological change and climate change—offer Scotland and businesses considerable opportunities to take the lead and reap the rewards.

Yes, Scotland has a strong tech and innovation ecosystem, but it’s more than that. Historically, Scotland has been a hotbed of invention. (almost) all the important things in the world started life in the mind of a Scottish innovator!! This mindset still exists, and when combined with the challenge of climate change, I am confident we will see Scottish businesses lead the world in innovation.

Already in 2025, we have had the announcement that Scotland will be home to the two largest battery energy storage systems in Europe at an investment of £800m. This is a massive investment in Scotland’s energy infrastructure and our drive to net zero, and it will also not be the only significant investment in this sector we see through 2025. A scroll of the available jobs on LinkedIn demonstrates the strength of the offshore and manufacturing sectors, particularly in the Northeast. Now, I am not suggesting these sectors will have it easy in 2025; there will be change, and with any change challenge, we are seeing businesses pivot their workforce and skills to unlock the opportunities of the climate challenge.

What should we all do to help us realise the benefits of 2025’s predicted growth?

Much like our personal lives, the turn of a new year is a good time to pause, reflect and plan. Take some time to think about yourself and your business, start deeper than your 2025 goals and think about what drives you and why you are running a business or considering starting your own. Consider your values, how they impact how you live your life and, in turn, how they influence your business. Then, and this is the critical part many overlook: create a plan of action to help you achieve your goals. Break each objective into bite-size chunks and identify the steps you must take weekly and monthly to deliver the results. Remember to ‘think in ink’, document your plan and use this as a tool throughout the year to drive accountability, be it with your team or yourself. For anyone looking to create a 2025 growth strategy get in touch I have some great tools and techniques that will help you do so with ease.

This leads me to the following action that I believe will help ensure you maximise your business growth through 2025: collaboration. Nobody and no business do everything on their own, reach out and connect with those individuals that can help you navigate the fast-changing landscape. I’m not saying this should be engaging a business consultancy like us at Harrison & Hunter (though you really should), but this can be any support network available to us all. Some are paid, such as the Federation of Small Businesses or the Institute of Directors, and some are free, such as Business Gateway or Scottish Enterprise. Other ways to connect and collaborate are through the many local business networking groups across Scotland. Not only will you find fellow entrepreneurs who may have the skills, knowledge, and expertise you don’t have that can support your business growth, but you will also find a natural support network facing some of the same problems and challenges as you are. With our better understanding of mental health, these groups can be invaluable to smaller businesses. Indeed, there are even groups set up where networking is secondary to looking after our mental and physical health.

Anyone near Edinburgh should check out The Outsider’s Group.

https://www.linkedin.com/groups/12952571

Finally, and although this one can be tough, the good news is that by reading this, you have already started to do it. Try to keep up to date with everything happening and changing across the business landscape in Scotland (and further afield). While a large majority of businesses across Scotland view 2025 as an opportunity, those that are actively looking are the businesses that will realise the opportunity. Market research is critical to any business strategy and needs lots of focus. Again, this doesn’t mean you need to be the expert or spend inordinate amounts of time on it; consider the previous connect and collaborate point and reach out to those who can help. We have some great hints, tips, and resources to share, so please get in touch info@harrisonandhunter.co.uk

I wish you all a happy, healthy, and prosperous new year!

Steve