It’s clear that, whatever the outcome, the situation will take some time to work itself out and that for many sectors the impact of current and planned austerity measures will be lasting and structural.
Many UK and European companies are now acting to assess the short and longer term risks and opportunities created by the crisis, and where necessary acting to develop robust contingency plans to address these. In addition, businesses are responding to the impact of austerity, looking to manage margins, cut costs and focus on cash flow, particularly in the consumer goods, retail and communications industries where cost efficiency priorities are greatest, according to our Business Leaders Survey 2012.
However, there is still a concerning lack of corporate planning overall. 36 percent of businesses surveyed at the end of January said they were doing nothing about the Eurozone crisis; less than a quarter (23 percent) reported that they were undertaking group led contingency planning across a range of options. KPMG has been working with clients to deal with this challenge and the effects likely to have an impact on their operations.
In KPMG’s view there are key steps businesses could and should be taking now, and we have been working with a number of clients to deal with this challenge, and the likely impacts on their operations.