Report: Scottish Mid-Market Investment Appetite Grows

Graham Turner

22 September 2026, 10.21am

Scottish mid-sized businesses are increasingly ready to invest, but rising costs and skills shortages threaten growth.

Appetite to invest has increased for nine in ten (93%) Scottish mid-sized businesses over the past three months, according to new research from accountancy and advisory firm BDO LLP.

The bi-monthly tracker covers 500 mid-market businesses with revenues between £10m and £500m. When asked which sectors Scottish business leaders see the most potential in to drive economic growth over the next five years, two in five (41%) identified the hospitality and leisure industry, followed by financial services (83%) and retail and wholesale (28%). This comes as the hospitality sector saw a strong performance over the summer, benefiting from increased domestic tourism and a World Cup bounce.

Despite a more positive outlook, mounting supply chain costs and disruption (cited by 59%), together with increased employment costs and skills shortages (45%), are the top challenges that risk holding back growth in a segment responsible for over £1.8 trillion in revenues and more than one in three private sector jobs.

Looking ahead, the Autumn Budget, followed by the Scottish Budget in early 2027, will determine whether renewed confidence translates into long-term investment. The areas businesses want to see the UK government prioritise to drive growth include improving transport and wider infrastructure, investing in skills, apprenticeships and workforce development, and expanding investment incentives and business support programmes.

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Businesses also highlighted where the government should focus specific funding to boost the economy. Two in five (42%) want the government to take equity stakes in strategic businesses (60%), with more than a third calling for increased business grants (28%).

Mark McCluskey, Regional Managing Partner at BDO in Scotland, said: “The Scottish mid-market wants to invest, expand and continue to be a powerful driver of jobs and revenue growth in the UK. Supporting them to do that is a no-brainer. The upcoming Budget, closely followed by the Scottish Budget in January, are crucial moments to provide businesses in Scotland with much needed certainty and confidence.”