More than nine in 10 (94 per cent) private business owners in the West Midlands are confident of delivering growth in 2025, according to KPMG’s mid-year Private Enterprise Barometer check-in. 

Earlier this year, KPMG unveiled its first-ever Private Enterprise Barometer, an annual survey capturing the perspectives of 1,500 privately owned businesses, including 133 in the West Midlands, from across various industries. 

Following a challenging six months of economic headwinds, KPMG has revisited  businesses to understand how developments in the first half of 2025 may have influenced their outlook.

Earlier this year, 95 per cent of private businesses in the West Midlands expressed confidence in their growth prospects for the next 12 months.

By the mid-year mark, this sentiment has fallen slightly, to 94 per cent, reflecting a marginal change in outlook regarding their growth ambitions. 

Technology continued to dominate as a leading investment priority for West Midlands-based businesses, with two thirds (66 per cent) identifying areas such as artificial intelligence (AI), cyber security and broader digital transformation as key focuses.

While the region trails behind London and the North East’s overall commitment to technology investment (74 per cent), it nonetheless demonstrates a clear and persistent ambition to remain at the forefront of digital innovation. 

Diversification is also high on the agenda for private businesses across the West Midlands. A growing number of firms (80 per cent) are looking to introduce new service lines and expand their client offering.

Meanwhile, two thirds (64 per cent) are targeting entry into new markets. Both figures show increases (from 65 per cent and 61 per cent, respectively) at the start of 2025. 

When it comes to external challenges, inflation remains the most pressing concern, cited by two-fifths (41 per cent) of respondents.

This is followed by interest rates, which more than a third (37 per cent) of business leaders flagged as a key risk. 

The appetite for alternative funding options is also gaining momentum, with two in five (42 per cent) of the region’s private businesses now open to private equity investment.

This growing interest reflects a broader willingness among firms to explore new sources of capital in support of innovation, growth and long-term resilience. 

Andy Bostock, Birmingham office senior partner at KPMG UK, said: "Confidence among the West Midlands’ private businesses remains exceptionally strong at the mid-year point, with 94 per cent of leaders optimistic about growth prospects for the year ahead.

“From Birmingham’s thriving professional services sector to the wider region’s world-class manufacturing and automotive industries, firms are investing heavily in technology, including AI, cyber security and digital transformation, to diversify their products and services and enhance competitiveness. 

"Businesses are seizing opportunities to enter new markets and expand their offerings, supported by a growing interest in private equity as a means of unlocking future growth.

“While inflation and interest rates remain key concerns, the West Midlands’ track record of innovation, adaptability and sectoral strength puts it in a strong position to play a leading role in the UK’s economic recovery and growth.”