UK tech companies more worried about sales growth than credit crunch

The biggest issue currently facing the fastest-growing technology companies is not the credit crunch (as might be expected) but sales growth, according to new research from BDO’s TMT (Technology, Media & Telecoms) practice.

A survey of the UK’s fastest-growing privately held technology companies* has revealed that 40 per cent felt that maintaining their sales growth during 2009 is the biggest issue they will face.  This was followed by a quarter (26 per cent) highlighting that recruitment and retention issues would be keeping their chiefs awake at night.

Julian Frost, Head of Technology, at BDO, said: “In the current climate many would be astounded that the financial crisis wasn’t the number one issue facing technology chiefs – as it’s certainly top of the agenda for a significant number of UK company heads.”

“However, given the ambitious and entrepreneurial nature of the individuals behind these businesses – many of whom haven’t worked through a recession before – it isn’t surprising that sales growth comes so high up the agenda.  Particularly as on average these firms have grown at a rate of more than 80 per cent over the past year,” he continues.

Trade Sales and IPOs

Trade Sales and IPOs featured on the agenda of 18 per cent of technology companies, suggesting that the current market turmoil will create significant opportunities for those who are able to withstand the effects. 

“There will be a wealth of opportunities out there for acquisitive businesses and these results suggest that we should expect to see significant levels of consolidation in the technology sector during 2009 and 2010.  Those players who are presently more dominant in the market look set to become even stronger as a result of consolidation across the sector,” continues Frost.

Credit Crunch?

Interestingly, the research identified that only 16 per cent of the UK’s fastest-growing technology companies felt that the commercial downturn was the biggest issue they would face this year.

“We were staggered that so few felt that the financial crisis would be their biggest issue of 2009.  This is undoubtedly a positive thing and perhaps suggests that the technology sector will be one of the success stories of 2009,” concludes Frost.

ENDS

* BDO’s TMT practice surveyed 50 of the 100 fastest growing-technology private companies in the UK.  These companies were identified by The Sunday Times Tech Track 100 and were surveyed in the final quarter of 2008.

For more information, please email Dee Crooks at BDO, or telephone 020 7893 2761/07815 172 051

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