London Stock Exchange

In its ‘1000 Companies to Inspire Britain’, the London Stock Exchange (LSE) with assistance from the technology firm Growth Intelligence (which collects performance information on UK businesses), have listed the companies they see having the greatest potential for performance.

To qualify, companies needed to have at least 3 years revenue growth out of the last four and also must have outperformed competing firms in their business sector. The 2016 report gives business watchers and investors the information on what sectors of the UK economy are the most lucrative especially going into the New Year.

London Stock Exchange

The Report

Tom Gatten, chief executive and founder of Growth Intelligence states, “At the core of the methodology was relative growth, we were looking for companies that were growing much faster than their peers.”

How did they do this? Growth Intelligence uses a real time tracking system to monitor 3 million UK businesses including an ‘army’ of web-crawlers to gather ‘exhaust data’ or information that is found when a company is mentioned or conducts business online.

“We pull in about a quarter of a million pieces of text that appear on the web, new, every day,” says Mr. Gatten. “Blog articles, news articles, companies’ own web sites, social media posts — all sorts of stuff. And then we have a system that reads the articles and understands them.”

The software used to process the data can separate such information as ‘discussing the need for investment and one mentioning actual investment plans.’ Using information from hundreds of thousands of sources, the performance of a company creates a highly detailed report that helps a company with future actions that involve sales and creating new customers. The software also has the capability to track the number of PC’s that a business has connected to the internet.


Best Performing Sectors

The creative industries sector consisting of the film, music and advertising contributed £76.9billion to the UK economy providing one out of every eleven jobs in the UK. The value of this sector for daily exports amounts to £49million. One successful company on the list is the premium cinema company Everyman which has seen its venue capacity rise 60% over the past year. Another is London-based marketer Amplify which has 280 partners in their network to provide ‘focused expertise and bespoke campaigns.’

Another sector for performance is Britain’s Food and Drink industry. Described by the report:

‘An insatiable appetite for the artisan, the alternative and the adventurous is helping feed the success of the UK’S food and drink industry, A key ingredient in the nation’s economic prosperity.

The value of these companies brings £21.5billion to the UK economy with 6,360 small food and drink companies in Britain. Yearly growth of the food industry is expected to be at 3 to 4%.

One company profiled in the report is Japan Centre, which was founded 1976 and described as:

From its expanded premises in Central London it offers high-quality authentic Japanese food, drink and cooking ingredients to consumers in the UK and Europe.

One other brand on the list is Higgidy, a provider of home-made pies, quiches and sausage rolls which saw in 2015 a £12million turnover.  Founder Camilla Stephens says, “We are aiming to grow by almost 200%, extending the business in existing categories but also stretching to some adjacent categories where consumers are giving us permission to operate,” says Camilla.

Some use alternative methods for funding their operations such as BrewDog, a craft beer from Scotland has raised £20million through crowdfunding. Co-founder James Watt states: ‘In 2010, we launched Equity for Punks and now, through four rounds, we have raised over £20m – that’s more than any other company.’

The retail sector continues to see growth due to consumers “app-tapping” with 62% of shoppers using social media when buying their favourite brands, which could drive online revenues up to a projected £86.96billion by 2019. Additionally, 58% of UK consumers say ‘click and collect’ also encourages traditional visits to stores more often.

Purchases on the internet account for 10% of all retail sales.

‘With around three million employees and sales in 2015 totalling £333billion, the retail sectors a powerhouse in the UK economy.


Exports

Britain’s stake in exports was hit by the financial crisis but global demand for products has increased, bringing new firms into the market. The total value of British exports calculated in September 2015 was £42.7billion, with 40% of the exports being machinery and transport equipment. Further there was an increase of 262% of UK auto sales in the Asian markets between 2004 and 2009. Whilst technology products continue to grow for exports, British luxury brands are still in global demand as well.

One company profiled in the LSE report was CDE Global based in Northern Ireland and operating in the construction and mining sector. It offers industrial cleaning along with the design and manufacturing of machines that ‘maximise value from natural resources and building materials.’  This has made the company one of the global leaders for washing plant equipment, mining and mineral processing.

Businesses in 2014 spent £27.3billion investing in manufacturing. The UK is ranked 11th in manufacturing nations with 54% of UK manufactured goods exported.

Sherry Coutu CBE of the Scale-Up Institute describes the start-up market for UK businesses as, ‘Over the past five years, there has been unprecedented growth in the number of newly registered companies and we have now surpassed the rate at which even the US produces these promising start-up companies. Indeed, 100% of the net new jobs in the US and European economies derive from companies that are less than five years old.’

Even with the uncertainty of the new American administration (which is very pro-business) and Brexit, the key for many of these new firms is the attraction of investors and Britain has numerous great companies to consider.

By Kevin Murphy: www.kevinmurphy.london

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