CBI says UK business must adapt to 'new era' following recession

UK companies are facing a fundamental change in the shape of business behaviour that will last well into the next decade, the CBI has claimed.

In its report The Shape of Business - The Next 10 Years, the business body said that the recession and the Credit Crunch have become "catalysts for a new era" in which companies will have to adapt to lower credit levels and focus more on environmental issues.

In addition, the study said that, in the future, companies will have to re-evaluate their supply chain and offer more flexible working arrangements for their staff, establishing a "flexiforce" of workers in order to support a smaller core workforce.

Richard Lambert, CBI director general, said: "There are important questions about how businesses are going to finance growth and investment in the future.

"And in a more collaborative, less transactional world, closer relationships with customers, suppliers and employees and shareholders look like becoming the new norm."

The CBI ran a survey in conjunction with the report that found 68% of firms would be strengthening the level of partnerships with suppliers in the coming years with one in five companies saying they would offer finance to suppliers.

Paul Holohan, chief executive of Richmond Capital Partners, said: "Given enough time, luck and money, most companies can do everything themselves - but who has enough?

"So joint ventures and strategic alliances - which are already happening in the print industry are certainly worth the effort and do reduce the financial risk to both parties."

Lambert called on the market to provide "new forms of institutions" to offer finance to small businesses.

"And why not make it easier for companies to raise money locally, perhaps through new regional banking and investment opportunities, rather than having to rely on a few very big players in London and Edinburgh?"

The print industry has also continued to undergo structural change, as this year's Top 500 demonstrates.

Most notably, the turnover of the 500th company has halved for the second year in a row as the medium-sized companies bear the brunt of the recession.

See this week's edition of PrintWeek for more on the Top 500