Brexit leading to increased customer caution
CFOs and tech startup entrepreneurs are both showing risk aversion with Brexit the cause of most of the problems
The channel should have a role to play in helping chief financial officers and tech startup leaders, who are displaying signs of being more risk adverse than they have been for a while.
Given what's happening with the Brexit uncertainty and the trade war between US and China there are several reasons why those in charge of the purse strings might be feeling cautious.
According to the latest Deloitte CFO survey 83% of those surveyed believe that the UK business environment will deteriorate as a result of leaving the EU.
Only 4% of CFOs felt that this was a good time to take risks, which is the lowest level shown since the Lehman Brothers hit the wall back in 2008.
Ian Stewart, chief economist at Deloitte, said that there were plenty of reasons for CFOs to be displaying caution.
“Events in the last three years, and recent news suggesting the economy shrank in the second quarter, have added to worries about the impact of Brexit. This is not solely a question of the long-term outlook. Brexit has not happened, but it is acting as a drag on corporate sentiment and spending," he said.
"Almost two thirds (62%) of CFOs expect to reduce hiring in the next three years as a result of Brexit and almost half (47%) expect to reduce capital spending, suggesting a cautious approach from businesses," he added.
That downbeat feeling could spur some constructive pitches from resellers able to provide technology that will deliver efficiencies and save money.
Ian Pollard, senior vice president EMEA at Signavio, said that there was a chance to take the risk issue head-on.
“Along with reducing risk and costs, leveraging data to construct a real time picture will help CFOs to innovate more readily and drive business growth. The ever-changing finance function should definitely be viewed as an opportunity rather than a threat. By utilising available Business Process improvement technologies, CFOs can work with their wider team to transform operations, remain compliant and optimise productivity," he said.
Elsewhere in the market there were further signs of risk aversion with tech start-ups also indicating that they might hold back on investments. The latest Tech Tracker from Studio Graphene added to a worrying picture.
"The slight dip in the number of companies seeking investment or planning to hire more people should sound a warning that the on-going political and economic uncertainty is resulting in a slightly more conservative approach among some entrepreneurs," said Ritam Gandhi, founder and director of Studio Graphene.
"Clearly, startups need clarity on the country’s future if they are to effectively shape their own – the government must recognise otherwise both our tech startups and the wider economy will suffer," he added.