Firms prepare to cut costs ahead of recession

10 June 2020

More than two-thirds (70%) of firms plan to contain costs by making broad or department-focused cuts over the next 12 months, according to a survey. 

The survey, conducted Coupa Software, found that over 650 global financial leaders are expecting a recession following the outbreak of coronavirus, but many are unprepared. 

According to the survey, the majority of respondents (87%) believed a recession is likely, and more than half (53%) expect it to last six months or longer. 

UK respondents were the most pessimistic about the potential length of a recession, with 34% believing it will last more than a year, compared to 21% globally.

The survey revealed firms may not have the right spend management strategies in place, which could leave room for error when making critical business decisions.

More than three quarters (76%) said they were reliant on traditional or outdated methods to manage their business spend, and 42% of businesses were still in the process of digitising key systems.

The study found that financial leaders were concerned about supplier risk, with 83% concerned about the health of their tier one and tier two suppliers. On top of this, 40% of UK respondents said being able to swiftly change suppliers was one of their top concerns.

In Europe, Brexit negotiations were still a concern, as 83% of respondents believed Brexit should be postponed while the effects of the pandemic were dealt with. 

Almost a third (32%) of UK financial leaders believed Brexit negotiations should be delayed for more than a year.

Rob Bernshteyn, chairman and CEO of Coupa, said: “The results of this survey are eye-opening and reinforce the importance of having the right technologies and processes that provide visibility and control across all corporate spending.”

☛ Want to stay up to date with the news? Sign up to our daily bulletin.

Cambridge, Cambridgeshire
circa £55,000
Cambridge Assessment
New Town House, Buttermarket Street, Warrington WA1 2NH
Grade 10 £41,881 - £44,863
Warrington Borough Council
CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates