1. Adjust pricing regularly to reflect rising costs due to inflation.
2. Use flexible inventory management strategies to avoid overstocking and reduce tied-up capital.
3. Stay agile and respond to changing consumer demands quickly.
4. Strengthen relationships with your bank and consider alternative financing options.
5. Leverage digital tools to improve cash flow management and financial forecasting.

As our latest Retail & Leisure Report revealed, businesses that seize opportunities to innovate, connect, and ​respond to evolving consumer demands are better positioned to seize competitive advantage.

Our partnership with the Department for Business & Trade on the “Made in the UK, Sold to the Indo-Pacific” events, reinforced how exploring new markets and growing internationally could help diversify income streams to provide greater financial stability.

UK businesses have new opportunities to strengthen economic ties with high-value markets beyond Europe - read our article on how you could capitalise on these developments: In-depth guide: how the CPTPP could help UK businesses trade with Asia

With changes to business rates coming in the Spring, there’s much that businesses can do to preserve and optimise their liquidity.

Rising inflation and unpredictable market conditions continue to affect businesses in 2025. Costs for raw materials, energy, and wages are rising faster than many companies can increase prices. This means businesses need more working capital to cover increased expenses.

Regularly reviewing pricing strategies and establishing contingency funds could help mitigate the effects of inflation as you prepare for economic fluctuations.

Effective working capital management is crucial for sustaining operations and driving growth. Read our guide to managing cash flow in uncertain times.

Global supply chain issues remain a significant challenge. Delays and price hikes can tie up inventory, putting pressure on cash flow. Businesses need to manage stock carefully, as overstocking ties up working capital, while stockouts lead to missed sales.

One way to manage supply chain disruptions is to adopt just-in-time inventory strategies, reducing the need for large stock holdings. Additionally, negotiating better payment terms with suppliers could ease cash flow pressures, providing more flexibility to businesses.

Check out our Future Fit work on the opportunities from effective supply chain management: Supply chains: are you fit for the future?

Changes in consumer behaviour — such as the growing demand for sustainable products and digital services — have a direct influence on revenue cycles. Businesses must remain agile to meet new consumer demands without overextending credit or overstocking inventory, both of which can tie up valuable working capital.

To stay ahead, businesses could adjust their production or service offerings in response to demand changes, ensuring they don’t over-invest in inventory or services that aren’t in high demand. This helps optimise cash flow while maintaining operational flexibility

Investing in digital financial management tools could help businesses streamline cash flow management. Software that tracks invoicing, payments, and financial forecasting gives businesses real-time insights into their cash position, enabling quicker decision-making.

Automation tools could speed up invoicing and payment cycles, reducing the time between invoicing and receiving payments. By investing in technology, businesses could improve cash flow visibility and better plan for future financial needs.

1. Financial stability and reduced risk
2. Increased flexibility for growth
3. Stronger supplier and customer relationships
4. Improved profit margins