UK businesses are cutting costs and monitoring cashflow due to the downturn, according to a new survey.

The survey, from accountants and business adviser MacIntyre Hudson, revealed that 84% of respondents think there has been a significant deterioration in the overall economic climate for businesses this year, while 55% said trading conditions had become more difficult since last year and 83% are anxious over how business conditions will develop into next year.   

Three quarters are placing stricter controls on operational expenditure, while 44% have cut capital expenditure and 30% have axed jobs. Almost half (47%) are tightening credit control for existing customers, while 44% have stricter credit assessments for new clients.

Atul Kariya, principal at MacIntyre Hudson, said: “In the current economic climate, prudent action to control costs and maximise cashflow is essential. The UK economy has enjoyed a long economic cycle with 15 years of economic growth, during which most businesses found that increasing revenues was a natural consequence of a generally buoyant economy. However, in today’s more difficult climate, tight control of cost and a focus on cashflow have become of paramount importance as the sales growth may simply not be there anymore.”